Who don’t want to receive income in a regular basis, with little time and effort required to maintain it? Unlike active income, such as salaries, wages, service tips, and business income in which you must actively work to earn it, passive income is earned without actively working or materially participating on it. You can even earn passive income while sleeping or while enjoying your vacation.
Different sources of passive income
Passive income may include rents from property, royalties from books, and advertising earnings from blogs. Among these types of passive income, advertising income from blogging is one that I am actually enjoying now. Blogging can also be started by anyone and doesn’t require big amount of money unlike buying an expensive property to start earning rent income or unlike earning from portfolio income (income from investing in stocks, bonds and mutual funds) in which you need to invest money to make more money.
What is a blog?
Blogging is one of the most popular ways to making money online today. If you don’t have any idea what a blog is, well… you are reading at a blog at this moment. A blog is a type of website that regularly publishes blog posts in a chronological order. A typical blog shows its recent posts in its homepage. The person who is maintaining a blog is called a blogger, while the process of updating a blog is called blogging. For more comprehensive information about a blog, you may read Wikipedia’s entry about it.
3 types of income you can earn from your blog
To have an idea on how you can choose to earn passive income from your blog, you have to understand the following 3 types of blog income:
1. Active income. This is the income you earn from the work you perform with your blog. A blogger doesn’t earn this without performing a service. Examples of an active blog income are earnings from paid posting, sponsored reviews, and compensation income from the services you offer on your blog. For active blog income, no work no income.
2. Portfolio income. This is the profit you earn from the money you’ve invested on your blog or blogs. This type of income is usually earned by website flippers (those who buy and sell sites for profit) and investors who may invest money on various blogs to earn more. Portfolio income also includes advertising income from blogs that receive paid traffic. For portfolio income, if there’s no money to roll on there’s no income.
3. Passive income. This is the income you earn in a regular basis even without performing service or without investing money on your blog. Passive blog income includes advertising income you earned from organic or unpaid traffic. Considering the nature of this income, a blogger can earn it even while he or she is sleeping. However, before a blogger can earn passive income, he or she must first build a high-quality blog that will serve as the base asset that generates such passive income.
Now, what type of blog income do you want? In my case, I’ve chosen to work for passive income. I chose it even before I started this blog. I decided to focus on creating unique and quality blog posts than instantly earn from publishing paid or sponsored posts. I also established this blog to carry my name and earn a good reputation, rather than develop it for website flipping or for selling it for profit. But though I decided to concentrate on earning from passive income, I’m also considering active income from selling professional services and portfolio income by infusing more money to the blog to improve its quality. Diversification of income or having multiple streams of income is good as long as you don’t destroy your main income.
How to earn passive income through blogging
So how can we certainly earn passive income from our blogs? To share my experience and the lessons I learned from years in the blogging industry, here are some important tips and steps on how to build a blog that generates passive income.
1. Plan it. Have a plan. Determine your goals and purpose. Plot the steps you have to take to achieve those goals. Align your skills and resources. You have to choose your priorities and really intend to make a blog that generates passive income. At this moment, you have to make a choice… do you want your blog to mainly generate passive income or active income?
There are several income streams that may fall under active income. The following are some of the most popular monetization schemes you might want to implement:
– Google Adsense and other Pay Per Click (PPC) ads – This can be considered as active income if your traffic is organic
– Direct advertising – Fixed rate direct advertising may fall under active income. Per impression rates may also be considered active if your traffic is organic.
– Affiliate programs. Earnings from affiliate programs can be considered active income if the blogger doesn’t have an active participation on the sale or delivery of the products.
2. Build a blog that lasts. Passive income is generated by an asset that is appreciating. Hence, you have to build a blog that increases value overtime. How to do that? Create a blog that contains high-quality content. Publish blog posts and articles that remain useful overtime, such as evergreen articles, how-to or tutorial articles, and well-researched and extensive articles.
3. Learn SEO. Traffic from search engines are organic. Targeted organic traffic convert well when it comes to PPC advertising like Adsense. If you want to enjoy passive income on your blog, you have to learn and apply search engine optimization (SEO) on your blog to rank your pages higher in the search engines and attract more organic traffic. Here’s one of our post about how we’ve applied simple SEO techniques on this blog to receive thousands of traffic every day from search engines, like Google, Yahoo and Bing.
4. Create more and more unique and quality content. The more quality contents you have, the more traffic or visitors your blog will receive. We currently have less than 500 blog posts on this blog, and we are already receiving an average of 5,000 visitors daily. Just imagine if we will publish more quality posts, how much increase in traffic could we gain?
Because I chose to earn primarily from passive income rather than from active income when I started this blog, I rejected a lot of sponsored posts proposals. I may have lost money for that, but this blog was created for long-term benefits rather than for short-term earnings. Publishing sponsored posts has the following disadvantages that we want to avoid:
– They are usually not unique
– They don’t usually attract visitors from search engines
– They don’t give you constant traffic
– Other types of paid posts may hurt your SEO and may even lead to penalties from search engines
– Some sponsored posts don’t provide value to your regular visitors
– With money as compensation, they may impair your independence as a blogger
Of course there are other advertisers and paid post requests that you can accept without hurting your blog. You just need to be careful and apply quality control in choosing what to accept and what to reject. But if you are good at writing or if you are seriously willing to develop your writing skills further, you may just concentrate on publishing original and quality content that will drive more traffic to your blog. You may check out these ten types of blog posts that attract massive traffic.
5. Do the waiting and have timing. Be patient and diligent. Remember that building a blog that generates passive income takes several months or even years. You also have to stick to your plan, that is, to earn passive income. If you can establish a quality blog that earns passive income, you will also establish your reputation. A good reputation is also helpful if you want to earn active income from providing professional services on your blog. In other words, active income and other income actually follow passive income.
6. Don’t be tempted with easy money. Earning easy money is very tempting. Of course, who don’t want money these days? But we need to be careful in cashing out instant money. We need to avoid monetization schemes that will destroy our long-term goals. Examples of things you should avoid are:
– Spamming and using black-hat SEO techniques to attract more traffic to your blog. It will destroy your authority and reputation.
– Placing excessive ads on your blog. It looks unprofessional and may discourage visitors.
– Publishing paid posts that don’t provide value to your regular visitors.
– Selling and promoting unreliable products on your blog.
– Making money on the Internet at the expense of other people. We need to show respect.
7. Follow the rules. We’ve got to follow the rules to avoid penalties, punishments, and loss of integrity. Some of the rules you need to follow as a blogger and Internet marketer are as follows:
– Rule on morality and equality
– Rule of ethics
– Internet etiquette
– Law on copyright
– Google policies – Follow Google’s guidelines on SEO and on Adsense
– Social media policies – We have to observe ethics when promoting our blog in Facebook, Twitter, Google+ and other social networking sites.
8. Keep track on your blog. Finally, monitor your blog to determine if you are heading the right way. You also have to evaluate your progress and determine if you need some improvements. Be consistent until you reach your goals.
Passive income needs big investment, but it doesn’t always mean monetary investment. In blogging, you have to invest tremendous time and effort to build a blog that can generate passive income. It’s like wanting to harvest fruits in a regular basis. You have to plant a tree and patiently take care and wait for it for years to grow. But once it grows and bears fruits, you don’t need to plant a tree again and wait for years to enjoy fruits. You can just wait for it to seasonally give you the fruits you want without exerting more effort. On the other hand, active income is like planting rice. They grow faster than trees, but you have to plant every time you want to harvest rice. So choose your priorities now.