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Initially you may only be making a tiny amount of money passively, and you may even want to re-invest that money so it compounds and grows quicker. But with some time, its potential to create enough passive income you could quit your job or retire .

Passive income can be a bit of a divisive topic. In general, passive income is any money that you make without putting in much work. The money will flow in without too much being required of you. In some scenarios it could be long-term recurring income, and in some other cases it might be short lived or inconsistent.

In some cases youll need to put in some effort up front, but then it wont need as much effort in the future when youre making the money.

Exactly what qualifies as passive income is up for debate. Most lists that youll find online will include things like blogging, writing e-books, or creating your own course. Im not including those thoughts in this post because, in my own opinion, they all require an excessive amount of effort to be considered as passive.

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Blogging will always need on-going work, either by yourself or from other people which youre paying.  Selling ebooks or classes will need on-going customer support, and youll need a consistent traffic source in order to continue to make sales. It's possible and there are individuals who've been in a position to get it done passively, but they make up a small percentage of people who really set out to get it done.

Ive been blogging full-time for 10 years and Ive sold ebooks and classes in the past. Theyre great ways to make money, I just dont consider these to be more passive, in most cases. .

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Just about any business can be a source of passive income if youre paying others to run the business. That is true with both online and traditional businesses. That opens up even more possibilities than that which will be recorded here.

Now lets take a peek at some of the greatest ways to make passive income. Some of them are investments that will need some money to start with. Others wont need any money to get started. In case you dont have the money to invest now, try starting with the approaches that dont need any money, and then utilize that money that you make to invest. .

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Your very first financial priority should be to develop an emergency fund that will cover all your living expenses for a few months. But dont put this money would be a checking or savings account at a local bank that pays you a horrible interest rate. You can open a high yield savings account or money market account with an online bank that will earn a much greater return for you.

My spouse and I keep our emergency fund in a money market account with CIT Bank. At the moment (October 2018) CIT money market accounts are earning 1.85percent APY and CIT savings accounts are earning 1.55% APY. Thats 22x the national average! Opening an account with CIT is quick and simple, and can be done online. .

Some companies consistently pay dividends to their shareholders. As a trader, you can re-invest the dividends to buy more shares of this inventory, or take the dividends in cash. read the full info here Reinvesting will allow you to own more stocks, which contributes to more dividends in the future (ideally).

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The companies that consistently pay dividends tend to be large companies with a long history of success. As a result of this, these investments tend to be considered less risky than the stock exchange in general.

Dividend stocks can be a great investment regardless of whether you want to reinvest all of the dividends on hold on to this stock for a long time, or make use of the income generated through the dividends.

For much more detail on the topic read Investing in Dividend Stocks in Investopedia. To get a list of these shares, see this collection from Dividend.com and this collection from DividendValueBuilder.com.

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Peer-to-peer lending (or P2P) has become extremely popular in recent decades. Borrowers and lenders can be matched up through a website or marketplace. Instead of going to a bank, the debtor gets a loan from an investor.

In some cases the borrower might not have the ability to be eligible for a loan via a traditional bank. And in many circumstances the borrower gets a better interest rate than they might receive from a bank. As an investor, you can earn a good return as well.