Most people are looking for an extra source of income these days.
Wage growth is limited in the current environment, the best way to boost your main job income seems to be to change jobs. But I wouldn’t call that passive income.
Many are resorting to get a second job to boost their income, but that’s not passive income either.
There are plenty of things that we can do to increase our income without leaving the house:
Online surveys and rewards?
Whilst not specifically passive, doing online surveys certainly doesn’t require getting a job or leaving the house. There are plenty of providers out there.
But, there’s not much money in this, probably only a few dollars an hour. You’d have to do a lot of surveys to make $1,000 a month!
Start an online blog / vlog / other social media?
There is a huge amount of eyeballs on the internet these days. There are plenty of people out there earning a full time income (or more) by writing a popular blog, doing an interesting vlog on YouTube or just having an Instagram-able lifestyle.
But that’s not for me and I imagine it doesn’t work for most people who try it either.
It’s certainly possible to generate a passive income from property. But I don’t think it’s a good idea to think about buying property for income. Most residential property in Australia has such a low gross rental yield that negative gearing (making a cash loss) is inevitable unless you buy it with cash upfront.
And besides, to buy property you need a large deposit to start with.
Cash in the bank?
You’re lucky to find savings accounts with interest rates of 2% these days, I don’t think cash is the answer.
I think the best and only real answer is ASX shares. Once you’ve bought the shares you don’t need to do anything else, that’s true passive income.
You can start with as little as $500, you don’t need a $50,000 deposit like with property.
There are excellent dividend shares out there with various yields, depending on the yield and growth you’re looking for.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) has an extremely reliable dividend record with a grossed-up yield of 4%.
Rural Funds Group (ASX: RFF) is one of the most consistent REIT distribution growers with its farmland portfolio and it has a FY20 yield of 5.75%.
WAM Research Limited (ASX: WAX) has grown its dividend every year and has a grossed-up dividend yield of 9.7%.
With interest rates being so low these days I can understand why people need to find extra income. I think ASX shares with fully franked dividends are definitely the way to go.
The post How to generate $1,000 a month in passive income appeared first on Motley Fool Australia.
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Motley Fool contributor Tristan Harrison owns shares of RURALFUNDS STAPLED and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED and Washington H. Soul Pattinson and Company Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019