The more streams of passive income freelance writers have, the happier and wealthier they’ll be! These tips for creating passive income are inspired by Thursday Bram’s recently released The Freelance Writer’s Guide to Passive Income.
“It’s a simple truth for freelance writers that, most days, someone else is making more money off our work than we are,” writes Bram in The Freelance Writer’s Guide to Passive Income. “Magazines pay a fair rate for articles, but turn around and make far more on subscriptions and advertising.”
Fellow scribes, that is exactly why I want to earn a full-time living blogging, not freelance writing! If you’re thinking the same thing, you must read Bram’s ebook. And, here are five tips for creating passive income (inspired by – not excerpted from – Bram’s guide).
5 Tips for Creating Passive Income for Freelance Writers
1. Know the difference between active and passive income! Active income is when you trade your time for dollars (eg, you write an article, you get paid). No writee, no payee. On the other hand, passive income is when money works for you. You do the work once, but continue to get paid over and over. An example of passive income for writers is publishing a book, song, or poem and earning royalties. Another is advertising on your blog or writing for online sites that pay you a commission for ad clicky clicky (not payment per article or blog post). My first source of passive income was writing for Suite101. The beauty of passive income is you’ll stay financially solvent if the freelance writing assignments dry up because you’re not dependent on one source of income.
2. Schedule time to take care of your “passive” income. Some writers argue that blogging isn’t passive income because it requires time and attention. Perhaps…but does a truly passive source of income exist? For instance, if you created ten blogs and hired managing editors to keep your blogs healthy and active, you’d still need to pay your editor, do the bookkeeping, problem solve, hire a new editor if this one quits, etc. And, you may need to do some promotion and marketing (radio interviews, virtual blog tours, etc.). So, this tip for creating passive income is about making sure you have time to nurture your little money maker.
3. Research the different types of passive income for writers. This is where Bram’s ebook comes in handy: she describes different types of passive income related to freelance writing. Sure, blogging is one source of income – but there are others (such as ebooks like Bram’s Guide to Passive Income and my own Quips and Tips for Successful Bloggers). But remember — what works for one writer won’t work for another. It’s important to be aware of all the possible sources of passive income.
4. Be prepared to invest financially in your source of passive income. Even the most cost-effective types of passive income – such as blogging – may require a one-time or ongoing financial investment. For instance, my blogs are hosted by Host Gator; I recently moved from a shared server ($5 a month) to a VPS ($50 a month!). I bought most of my WordPress themes, and I pay my web master a few bucks here and there to tweak the code. Freelance writers, you need to know that passive income isn’t necessarily “free money.”
5. Get out your business suit and briefcase. This is another passive income tip that Bram explains in detail – and that I don’t give much thought to! Creating effective passive income streams requires a bit of business acumen and knowledge of market competition, bookkeeping skills, effective customer relations, content marketing, advertising, public relations, product launches, and more! You don’t need an MBA to make money passively, but you need a working knowledge of basic business strategies.
In The Freelance Writer’s Guide to Passive Income, Bram lists several “writers’ success stories”, describes potential problems and solutions, and shares things I’ve never heard of (such as PLR or Private Label Rights). It’s good stuff!
What do you think – do you have any questions or suggestions about creating passive income for freelance writers? Please comment below…