Curious about how to make $40,000 a year from home? For many people, earning that much from the comfort of home would be a dream come true.
Fortunately, you can make this much in a year or less from home, even without a degree! The key is to create two types of income: passive income and active income.
Passive income is money you can earn with minimal effort once it’s set up. Initially, you’ll need to invest time, energy, and money to get it started. But after that, you’ll keep earning, even while you sleep.
Active income is the money you earn from working at your job or running a business. You need to keep working to earn it, which is why it’s called active income. If you have both passive and active income, you can boost your cash flow and make money faster.
In this post, I’ll share different ways you can make $40,000 a month, either right away or in just a few months.
If you want to create passive income this year and in the future, I suggest trying these methods to earn money with little ongoing effort.
1. Real Estate Investment Trusts (REITs)
Don’t want to manage property but still want to invest in real estate? Consider real estate investment trusts (REITs). REITs are companies that own and run income-producing properties. Since they are traded on the stock market, you can buy and sell their shares just like other stocks to suit your investment needs.
REITs don’t pay corporate income tax, so they can pass on more profits to investors.
2. Crowdfunded Real Estate Investing
Another easy way to invest in real estate without actually buying property is through crowdfunded real estate investing.
In this type of investment, companies like Fundrise gather money from many investors to buy and manage real estate properties. Unlike buying a rental property on your own, which needs a lot of money, you can invest in real estate through crowdfunding with just a small amount of money.
3. Sell on Amazon
If you’ve always wanted to start your own business, think about selling on Amazon.
Many people have made a lot of money selling on Amazon, so yes, you can earn $50k from it. A great way to start selling on Amazon is by using their FBA (Fulfillment by Amazon) program.
With Amazon FBA, you team up with Amazon to handle shipping for you. When someone orders your products, Amazon packs and ships them from their warehouses. You don’t have to do anything. They also manage customer service for you.
4. House Flipping
You can earn passive income and make $40,000 from real estate by flipping houses or properties. This means buying properties at a low price and then selling them for a higher price.
House flipping involves buying a house at a low price and selling it later for a higher price. This means you might need to keep the property for a while before you can sell it and make a good profit.
You can also look for a property that’s priced low because it needs repairs and updates. After buying it, make the necessary improvements, consider how much you spent, and then set a higher price when you sell it.
5. Dividend Paying Stocks
Investing in dividend-paying stocks is a good way to earn more money and create passive income. You buy stocks from companies that pay you a portion of their profits regularly, either every month or every few months.
How much you earn from dividend stocks depends on how many shares you own. The more shares you have, the more money you’ll make. Also, dividend stocks increase in value over time because of compounding interest. This means you can just let time pass, and your investment will grow on its own.
Investing in dividend stocks can be confusing if you’re new to it. It’s a good idea to get advice from a financial expert or use advisory services. Also, make sure to research each company you’re thinking about investing in.
6. Stock Market
Besides dividend-paying stocks, you can also grow your portfolio by investing in the stock market. Just like dividend stocks, stock market investments can help you make money passively.
In simple terms, you buy company stocks when they’re cheap and sell them for a profit when their prices go up. However, it’s not easy for a beginner to just start and make money. You’ll need to do your research and understand the risks involved.
If you’re interested in starting with passive income but want to go slowly, consider using a Robo-advisor service. These services handle your investments for you. For example, Stash lets you invest in small pieces of stocks and ETFs without needing a lot of money upfront.
The stock market can be confusing for beginners, so it’s a good idea to get advice from experts when you start.
7. High-Yield Savings Account
You can also make money passively by putting your money in a high-yield savings account. This type of account is like a regular savings account but offers much higher interest rates. As a result, your money grows faster compared to a standard savings account.
High-yield savings accounts are a great way to earn extra money because they offer much better interest rates than regular savings accounts. You can open one at your current bank or check out online banks, which often provide higher rates. Most online banks are insured by the FDIC and can easily connect with your other bank accounts, making it simple to move money around.
8. YouTube Content Creation
Creating content on YouTube is a great way to make $40,000, even if you have little money to invest. All you need is a decent smartphone and a YouTube account to start uploading videos.
Making money on YouTube is a lot like blogging; it takes time and effort. You need to get at least 1,000 subscribers and 4,000 hours of watch time before you can start earning money from your videos. In the beginning, you’ll need to promote your channel to get more viewers.
After that, YouTube will show ads on your videos. The more viewers those ads get, the more money you earn. You can also make money by creating sponsored videos or including affiliate links.
9. Peer-to-Peer Lending
Did you know you can make $40,000 and earn passive income by lending money to others?
Peer-to-peer lending is when you lend money to people who can’t get a loan from a bank. You join other investors to pool your money and give loans to these borrowers. The borrowers then repay the loan with interest.
There are many platforms where you can lend money directly to others. You just need to sign up as an investor and decide who you want to lend to. As long as the borrowers repay their loans, you’ll keep earning money online.
10. Affiliate Marketing
When it comes to earning extra money online, affiliate marketing is a great option. In affiliate marketing, you team up with a company or network to promote their products or services online. You earn money when someone buys through your special affiliate link.
To succeed as an affiliate marketer and earn passive income, you have a few options. You can start a blog on a specific topic and add affiliate links to your posts. You could also make YouTube videos about the products, like unboxings or reviews, and include affiliate links in the video descriptions. Another option is to share social media posts about the products you’re promoting.
This business model lets you earn passive income by repeatedly making money from the same affiliate link. Many successful affiliate marketers have proven that you can make $40,000 or more passively using this approach.
11. Blogging
One great way to earn both active and passive income is through blogging.
Blogging is an active way to make money because you have to work on it regularly. You’ll need to find your blog’s focus, come up with topics, and write content that your audience will find interesting. You also need to improve your content so it appears in search engines and interacts with your readers. To earn a significant income from blogging, you have to keep doing these things consistently.
However, blogging can also bring in passive income because you can keep earning from the same posts. For example, if one of your blog posts goes viral, you might make money from ads for a long time. Plus, you could have chances to write sponsored content. As you build your reputation in your field, you can also create and sell e-books, online classes, and other digital products. The possibilities are endless.
Blogging can be time-consuming and requires effort to get started. However, if you treat it like a business rather than just a hobby, it can help you earn $50k quickly.
12. Run an Online Business
You could also start your own online business. You can sell your products on platforms like social media, Shopify, and Etsy.
The main difference with these platforms is that you need to be more involved. You’ll handle product selection, manage inventory, do the marketing, take care of shipping, and deal with customer service.
Still, running an online business can be a great way to make money, and you could earn up to $40,000 a month from it.
13. Run a Bricks-and-Mortar Business
Online businesses are popular right now, but you can still open a physical store and earn $40,000.
Many local businesses need a physical location to operate. For example, if you’re a barber or hairdresser, you need customers to visit your shop to make money. Other businesses like shoe stores, clothing shops, cafes, bakeries, and restaurants also rely on having a physical space. While you can offer online services like ordering or purchasing, some businesses still need a physical presence to stay profitable.
14. Proofreading
Proofreading is a popular skill that lets you earn money online from home. As a proofreader, your job is to spot and fix mistakes in written content.
Proofreading is easy to start with very low costs. All you need is a computer and a stable internet connection. It can help you boost your income a lot.
Proofreading can be a good-paying job. For example, Caitlyn Pyle, who created the course Proofread Anywhere, earned $40,000 in her first year working part-time. If she could make that much, you could earn $40,000 or more in a year if you take the job seriously.
15. Sell Online Courses
Creating and selling online courses is a great way to earn passive income. You could make up to $40,000 in a year with this method.
You can create and sell any type of online course you want. Just find a common problem your audience faces and make a course that helps them solve it.
Most of the effort goes into creating the online course. Make sure it’s easy for your audience to understand by providing clear, step-by-step instructions. Use different types of media like videos, images, and infographics to make the course more engaging and easier to follow.
To market your course, you can use your social media or send out newsletters to your email list to generate excitement. After that, you just need to wait for people to buy the course. As long as people keep purchasing it, you’ll keep earning money from it.
Writing e-books is another way to earn passive income using your skills and knowledge. It’s like creating and selling online courses, but in the form of a downloadable digital book.
16. Write e-Books
You can write an e-book about something you’re skilled in. To make it easier, you can hire a team: a ghostwriter to help with writing, a proofreader to check for mistakes, and someone to design the layout. After that, publish your e-book on Amazon Kindle, promote it, and earn money from it over and over again.
17. Sell Printables
Make money in your free time by creating digital products called printables. Printables are downloadable items that help people with different needs. You can design printables for things like budgeting, meal planning, party planning, wall decor, planners, calendars, and journals.
Selling printables is a great way to make money online, even if you don’t have any graphic design experience. You can use tools like Canva to make professional-looking designs. Then, you can sell your printables on your blog or website, or list them on platforms like Etsy or Shopify.
Printables can be a great way to earn money and make up to $40,000 in just a few months. If you’re looking to make money online from home with little ongoing effort, starting a printable business could be a good option for you.
18. Invest in Real Estate (Rental Income)
Investing in real estate is a popular way to make passive income. You can buy a rental property in a desirable area, rent it out, and earn money as long as it’s occupied. The rent you collect can help cover costs like the mortgage, maintenance, and taxes.
If you don’t own many rental properties, you can start small by renting out a spare bedroom on sites like Airbnb. This will give you some experience as a landlord and could help you add more rental properties later on.
Conclusion
So, there you have it: the best ways to make $40,000 in a year. By mixing both active and passive income, you can reach that $40,000 goal more easily and quickly, helping you move closer to your personal finance goals.