The other day at a coffee shop, someone asked if I could teach them how to earn passive income. I still find it strange that many freelancers and online entrepreneurs don’t know how to grow their passive income and wealth. I wrote an eBook on this topic. In this article, I’ll share some of the knowledge from my eBook to help you earn a more steady and stable income.
Important Introduction – Don’t Lose Free Money
Too many freelancers and online entrepreneurs (especially beginners) forget about recurring and passive income opportunities. And some are just totally unaware of this income source. It’s a shame, because they miss out on several streams of income that could stabilize and empower their life freedom.
Recurring and passive income is important. As freelance creators and entrepreneurs, we are responsible for our own wealth and well-being. So nurturing passive income should be part of the growth. It allows freelancers and entrepreneurs to create multiple income streams that continue to generate revenue without constant active work.
When I wrote the eBook “11 Passive Income Sources“, I wanted to help beginners, new freelancers, and digital nomads start early growing their passive income. The eBook is especially focused on how to earn passive income for web designers. But it’s also for other freelancers and even work-from-home moms who do a service online for clients.
Because I follow a specific but simple workflow, I make sure I don’t lose out on “free money”. And I will have regular payments coming in for years to come.
If this sounds great, then keep on reading.
Okay, show me how to earn passive income
Well, after having my freelance business for many years, transitioning to more of an entrepreneurial journey, I’ll share how my primary income works.
My primary revenue is getting paid for project-based and hourly work. So that is a one-time invoiced income.
But then we have the recurring/passive income. And I categorize them into two different streams here. This is something you can also do:
- Earn commissions from referring products for other companies (Affiliate income)
- Offer your own monthly services on a recurring basis to existing clients
This has been my second type of revenue for years. And I can easily categorize it into these two main groups. There are several methods and probably more clever ways that I haven’t even looked into yet. But that’s another story.
Affiliate income is not that big for me. But it all adds up. And sometimes there will be big “bonus” payouts coming in for more expensive products I have been promoting.
I will also say that being one of Shopify’s first “Experts” back in the days (“Shopify Expert”) is the source of most “passive” income that I earn every month. I get paid monthly without doing any work or spending any time on it.
When I do MORE work with new Shopify clients, that recurring revenue just keeps growing.
And I still get paid from Shopify every month because I worked smart from the start. I made sure I benefited from their partner shares, which will remain active for each store I have signed up to the Shopify platform and is still running a live store.
Then I have my own services and products. It’s mostly web design related. And I have several clients paying me for support. Their monthly price is between $97 – $497.
Another important, more or less passive revenue stream here, is my hosting service. After I started offering this to a few clients a few years ago, it’s been growing well. And I have expanded its visibility and reach by partnering with a couple of colleagues in the U.S.
Offering custom and premium WordPress hosting is awesome because it’s a very steady and secure income.
So you can see that building things up in a clever way, which is not hard, can easily grow your revenue to several streams of income instead of just getting paid for each single job you do.
What is the difference between passive and recurring income?
This is a good question. What is the difference between these two terms in revenue that I use?
- What is passive income?
- What is recurring income?
Usually, you will hear these terms mixed up from time to time. But they mean different things. At least in my world.
This is what recurring income means
Learning how to earn passive income. means having a steady payment coming in at intervals. It’s money coming into your account over and over. But, recurring income will usually have work involved from your side. You’re active in the process. For example…
Offering your own monthly services for a fee is a type of recurring income. But it is not 100% passive. You have to perform and deliver the work the client paid for.
Recurring income is still a good income source to have because it’s predictable revenue. So keep it on your list of future offers to your customers.
This is what passive income means
Having passive income as revenue means that there is very little, or no work involved. You are passive in the process.
It is usually revenue generated by doing a little bit of work one time and then earning commissions on a regular basis. Maybe a few times per year depending on the partnership deal and how many sales you refer. Your job only involves signing up as an affiliate, getting your links, and sharing them with your customers and the world.
My Shopify partner income is a true passive income. Because there is no work involved anymore on my part. I did the customer introduction to Shopify, helped with their site, and it’s still paying years after. And when I sign up and build new Shopify stores for clients, that partner revenue grows.
Aim to create “Recurring passive income”
The most optimal way you should aim for is to have passive income that is recurring. Then you’ve got your business-shit together when it comes to working smart.
It means that you are having recurring revenue coming in, but you have not been active in the process. You’re passive.
How does this work?
It could be as simple as having an affiliate link, or several, that is constantly generating clicks that lead to purchases. And you get paid, over and over. Doing the work for this, one time, could mean collecting your best affiliate links and putting them on your website. Done ✔️
This is one way to generate true recurring passive income.
How to Start Building Passive Income for Freelancers
My self-education to become a Web Designer, WordPress consultant, and general systems builder gave me the ultimate freedom to live and work anywhere.
So this could also be your path to greater freedom. Learn a skill while keeping these two recurring income sources in mind:
- Promoting products and services for others
- Offering a monthly recurring service
Learning how to build websites is an easy way to start. You don’t even need to take part in and struggle through a useless educational system. You teach yourself!
In fact, I have courses to learn these skills. A new platform that will have various courses for beginners to pros on how to use web technologies to work and live from anywhere.
Making websites is one of the easiest ways to begin this journey because the only things you need are a computer and the Internet.
1 – Share your affiliate and partner links
I have a specific process when working with clients around the world. And one part of this is to make sure I help and offer my clients the right tools, services, and apps.
For example, when working with clients for a web design project, there will usually be a few other services they need.
I will take care of the site-build. But they will also need quality domain and hosting. So I offer them 2–3 suggestions depending on their needs and budget.
And of course, I already have a collection of affiliate links for the services I recommend the most. I make sure to sign up as an affiliate or partner for good companies so I can suggest their services when needed. For hosting, I would suggest clients:
- Cheaper hosting like Dreamhost
- More high-end hosting like Cloudways
- Managed and premium WordPress hosting like WPAlchemy
So when communicating with my client, I send them an email and tell them what hosting to choose. The last one in the list above is my own service. We usually use this when clients want full-service hosting for WordPress with custom setup and integrations.
2 – Offer your monthly services
Start a creative process of figuring out what your customers and clients could benefit from on a monthly basis. Come up with a price that makes sense and offer this to your clients.
Keep a document ready with the monthly or weekly services that you offer. And make sure they sign up for your service package using their credit card instead of having to send them a bill for manual payment every month.
This is how you start building recurring revenue and stabilize your income.
Just make sure you get yourself set up with a nice payment system that automatically will send your customer a receipt for each charge on their card. Automate this as much as possible. There are both WordPress plugins and online services that will integrate with Stripe as the recommended payment provider. Then you could use an app like CashNotify to get live payment updates from Stripe right on your computer desktop.
How affiliate commissions are paid out
Some of the services that I have affiliate links for will pay out a one-time commission. Some will pay me a monthly passive income. Take ConvertKit (now called “Kit”) for example. They bring me a 30% monthly recurring commission for all the customers I have provided to them.
For other services and software, there may only be a one-time commission. And often, there will be a minimum amount earned necessary before they do a payout.
The payout to you as an affiliate partner usually happens to your PayPal account. But in recent years, more and more affiliate platforms offer to pay out to a bank account via IBAN.
I don’t want anything to do with PayPal as they’re not ideal. So I prefer a bank payout when I can.
Clients often need various tools and services. But I only recommend quality solutions that would actually benefit them. I also have tools that will pay me $200–400 per referred client (explained in more detail in my eBook).
Do you see the workflow here?
Keep a Document of Your Affiliate Links and Service Offers
When starting out as a freelancer offering your services, there are two ways for you to start preparing your plan to grow your passive income.
Create two documents that will always be easily available to you:
- One note or document for all your affiliate links
- One document to list your own services and prices
First, you will sign up for various affiliate deals for software and services and get your affiliate links. Later, when you talk to your future clients and share your best advice, keep your affiliate links document ready and share your best tips.
My Top 11 Passive Income Sources for Web Designers
Getting back to my quick-read eBook here. I wrote this one to help beginners get set up growing their passive and recurring income faster.
In this book, I cover the basics of what being an affiliate is, how it works, and where you can sign up to get started. It’s a simple must-read if you haven’t started yet.
I’m also including my top tools and services that fit perfectly into the workflow for many freelancers.
I also include direct links to all affiliate signup pages so you can get set up fast and have your links ready for the next client project.
Obviously, I can’t stuff my whole eBook into this article. So to get started fast, plus register for the 11 best affiliate income sources that I use all the time, go fetch the eBook and start building recurring and passive income here.