By Aja McClanahan
Having worked as a database consultant from home for over 13 years, this past year was my most successful year. However, I was completely exhausted. I think this is a natural evolution in the entrepreneur’s life, especially if you start out as a service provider. You’ll eventually come to the end of yourself and want to turn your knowledge and experience into passive income. If you are at that point, here are some ideas of what to consider to start your passive income journey.
Our family paid off all our debt in 2013. Part of that journey included creating my consulting business to finance that effort. In an attempt to “mass mentor” all the people who kept asking me how we did it, my blog was born. On this site, I give out a lot of free tips and tools on business and personal finance, but I also collect income from providing premium information in the form of eBooks and eCourses. Additionally, I promote and sell other products that align with my mission, purpose and philosophy. I collect commission on these products. Like any business endeavor, it can take time to grow this source of passive income but it’s a great option to start with.
Write a Book
This can take more of an investment if you decide to pay for professional editing, formatting and graphic design. However, it can be a nice compliment to a web presence whether it’s a blog or a social media platform. The barriers to entry are quite low, so this option is quite doable as well.
Create an eCourse
People consume information differently. For some, eBooks work, for others video is a better delivery method. eCourses typically use video to relay information. Don’t think you have anything to teach anyone? Think again. Go to Udemy.com and check out all the topics people offer- from sleeping better to couponing and home schooling- there are tons of things you can teach. What do your friends and family ask you most about? Create a class on that. I have a few classes on Udemy myself and it’s been a fantastic source of income so far. I use Screencast-o-Matic along with PowerPoint (Google Slides is free if you don’t have PowerPoint) to make courses. Udemy is a good place to start if you don’t have a big following, as they do a lot of promotion for their instructors.
Train and Outsource Protégés
If you are providing services but are not yet ready to transition from this income stream, this is a good start into the world of passive income. I used this method as a consultant. Once I got myself established, I began to hire and train people to do what I did. As a rule of thumb, you want to always be training your replacement (if your desire is to scale your operations and revenue.) At times, I’ve had as many as five people working for me taking my regular hourly rate from $150/hour to quadruple that number! You have to have the capital and cash flow to manage this properly, but it can be done.
Divert Cash into Income Generating Investments
The beauty of generating passive income is that you can use it to generate more passive income. For me, this is the ultimate goal. Once we paid off all our debt, we were able to take the money we were using to make debt payments and put it into my business and buying dividend-paying securities. We are eyeing some real-estate properties for rental income at the moment as well. The takeaway here is that money can work so much harder than you can. The only caveat is that you have to have a fair amount of money for your gains and related income to be substantive.
Which one of these methods do you think you could start with?
Aja McClanahan is a mompreneur who writes about eliminating debt, increasing income and building wealth regularly at www.principlesofincrease.com