7 REALISTIC Passive Income Ideas [let's be real]

No courses. No starting a YouTube channel. No selling anything to anybody. This video is about realistic ideas on passive income.

In my channel I prefer to approach topics from a realistic point of view. Most videos that talk about passive income talk about selling courses, starting a YouTube channel, becoming an affiliate marketer, or selling something, and I think that these videos leave you with no information on how to create passive income in your life.

So I wanted to create a video on realistic passive income ideas that you can use in your life. None of these are going to make you rich, but all of them you can immediately start using in your life to create [a little] extra passive income because once you have more money in your life, you can start spending more time on bigger ideas that can create a larger source of passive income.

I approach this topic talking more about ways you can save money in your life on things that you are already buying so you can save thousands of dollars a year. This is the same thing as passive income because when you are saving money it is pretty much the same things as making money.

Here are the 7 passive income sources I mention in this video.

1. Index Investing

Index investing is a very passive approach to investing where you invest by buying index funds. There are lots of different types of index funds such as Vanguard, Charles Schwab, and many others. An index fund is a group of stocks that track a market index like the SP500, DOW, or the NASDAQ. The stock market on average has a return of 10% a year, some years it is more and others it is less, but if you plan on holding long term and continually invest through dollar cost averaging, index investing is a great source of passive income.

2. Credit Card Hacking

Credit card hacking is maximizing the value you get from a credit card's rewards and benefits. There are many approaches to credit card hacking, but one specifically is through "cash back rewards." Most credit card companies offer cash back on purchases every time you use your credit card and this is usually between 1-5%, but expect 1.5-2%. This is a great way to get an extra few hundred dollars each year with little effort. All you have to do is use your credit card instead of your debit card and pay off the balance every months.

BEWARE: Credit cards can be extremely dangerous for people who lack self control due to their high interest rates. The average American has over $5,000 in credit card debt, so know yourself on whether or now you should get a credit card.

3. Grocery Store Hacking

Grocery store hacking is using the grocery store system in a strategic way to save money. This includes using grocery store apps to find deals, collect points to use towards gas, and get bonus points for shopping at the store. If you spend 5 to 10 minutes looking at the deals on the grocery store app, you can save 10% to 20% on a grocery shopping trip. BEWARE: Sometimes grocery stores advertise things as on sale, but in reality it is just a marketing strategy.

The other way is by buying generic brand groceries. Generic groceries cost on average 20% less than name brand items and when you look at the ingredients they are often identical. Don't pay 20% extra on something because it comes in nicer packaging!

4. Car Hacking

Car hacking is being strategic on how you use your car to save money. This includes using the Gas Buddy app on your phone to find the cheapest gas or strategically driving by avoiding small trips like going to the store 4 times a week.

5. Bill Hacking

Bill hacking is strategically paying your bills in a way to save you money. For example, when I pay for my car insurance if I pay it month-to-month they have $5 installment fees, but if you pay it all up front then there are no fees which can save you a lot of money.

Another way is by finding cheaper alternatives for some of your bills. For example, I use Mint Mobile for my phone service and it costs me $15 a month. The average person pays about $50 for their bill, so that is technically $35 in passive income each month.

6. Prep Hacking

Prep hacking is simply being prepared every time you leave you house to avoid convenience charges when you are buying snacks or water at a convenience store.

7. Don't Spend Money on Dumb Things

In the United States, we are the wealthiest country in the world, but most people have no money in savings. This is because people are using their money to buy dumb things like an expensive doorbell or a $2000 bike to work out at home. If you don't buy things that you do not need, you can save thousands of dollars a year and that is passive income!!

[ElAgustin]

Do you have any tips and tricks that help you make "passive income?"

[debbie]

I make up an entire loaf of peanut butter and jelly sandwiches every week and pop them in the freezer. Takes like 10 minutes. I grab one every morning when we head out the door. They thaw perfectly in like 20 minutes. This alone has saved me countless times from hitting a drive thru or convenience store when I get hangry when out and about during the day.

[alexanevin]

This is exactly my idea of passive income. Actually a dollar saved is more than a dollar made, because you dont pay taxes on it. :)

[sweedlepipe]

I get a dopamine fix everytime I save money.

[maryness]

A good tip to save on food costs (especially for a family) is to plan out your meals for the week. Write out the menu for the week, write down the items you need to prepare meals, search your fridge and pantry for items you already have, then shop (generic when possible) for only the items you need. This saves a lot of money! A dollar saved is a dollar earned!

[HH-xjnh]

“Money is the easiest and best source of passive income.” A powerful statement to end with.🙏

[heidii]

Ive watched hundreds of these how to make passive income videos and this is by far the most realistic! The other ones are usually from ‘already rich’ people talking about unachievable things to the regular person, yet they somehow make it sound like its easy or possible.

[TMIvey-gkmw]

There is nothing worse than being out on errands and then your throat gets impossibly dry. I try to never leave the house without my water bottle. I also sometimes throw a piece of string cheese in my purse to intentionally eat at the halfway mark during my errands. It does not cause a blood sugar spike like a lot of other snacks might.

I also truly appreciate your comment about a stationary bike is basically a waste of time. That is the reason why one of the reasons why I keep hesitating to get a gym membership. I found out the optimal number of steps that I need to take a day to not have my body fall apart and I leverage those steps as extra walking around at grocery stores looking for the best price and bargains.

[omalleysmith]

THANK YOU for this. Finally a video about "passive income" that isn't misleading, unrealistic, disingenuous OR advocating that people should make high risk decisions on the stock market. Great advice.

[tepobuo]

We do all of these things, and have estimated that we get about $1k value per month with just these things. We got going slowly, first paying one bill up front, buying one food in bulk. Now we have everything that way and it’s really paying off. We just don’t buy anything unless there’s a sale or a discount, basically.

[saratonnan]

I started walking places. I found a hairdresser closer to home & made the switch so I could walk there. Also started walking to the slightly more expensive grocery store near me once a week as opposed to driving to my usual store several times a week.
Quit my kickboxing gym & bought a bag to use at home plus I take advantage of free YMCA membership for "older" (I'm not old 😊) folks. I'm working up to walking there, as it's several miles away.
Will now add more money saving grocery hacks, like generics, as you mentioned, & will be looking for other things I can do.
You've inspired me, Austin! 😁

[HansikaBrown]

I sympathize with many people who had no knowledge digital marketing because currently dollar is unstable and coin is taking over to be universal currency

[jorgecumi]

I’m 47, I worked really hard and I have a paid off house and a paid off 6 unit apartment building, nothing else, I can’t complain, I do have a decent life, but honestly, there’s nothing passive about my building, I quit my job at 44 because of the pandemic, best decision ever to be honest, but tenants, maintenance and the government do keep me busy.

[nsbunnell]

I really liked this. As a stay at home, homeschool mom of 5 I'm always feeling guilty for not helping out financially. My husband always tells me that I'm the home So this video went hand in hand. Sometimes people.dont have the funds to start a blog or the time or desire vlog their lives. But by doing small intentional things like the things listed here you really can save which is the same as making money in my case! Thanks for the great video!

[tammiepulley]

Prep hacking is a game changer. Take food and drink with you almost every time I leave the house. Helps me maintain my weight and good health.

[Universe.]

Great video Austin! I too switched to mint mobile went from paying $70 per month to $20 per month, I notice no difference. Why isn't everyone doing this?!!!

[nelliemelba]

Bill hacking is definitely one way to go. Shopped around for the best deals for insurance, utilities (where you can!) I've done away with subscriptions I don't need, and paid upfront for things I do, which is usually cheaper than "spreading the cost". Excellent, REALISTIC video!

[miguelmartin]

Thank you Austin, your "realistic" passive income ideas are really, really real
You are proof that a person can be young and wise at the same time.

[mygoodlife]

Yesterday I walked to the shop- saving petrol. Took a carrier with - saved on the cost of a grocery bag. Shopped only bargains - another saving😊. Very made up with myself

[LindoDios]

I use my credit card to pay off my utilities bills, at the end of the year I receive cash back, and I invest that money. Instead of buying a Christmas present to myself, I invest. Last year I invested $320 from cash back.