16 Ways to Earn Passive Income in 2026
Looking for ways to make some extra money this year? We've compiled a list of different passive income ideas to spark inspiration, including investing, real estate and a few niche options, like operating a vending machine.
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For those new to it, passive income can sound like a way to earn money with little effort. In reality, most side-hustle veterans will tell you the same industry secret: It’s rarely hands-off.
For starters, you’ll need to think about how much upfront capital may be required, how long it might take to see a profit and the level of maintenance needed to keep income flowing. Some ventures may also require licenses, subscriptions or accounting tools to help you manage earnings and stay compliant with tax laws.
That said, passive income can still be well worth pursuing — especially when it aligns with your time, resources and long-term financial goals. To help you compare your options, our editors have compiled a list of 16 passive income streams, organized by category and who the strategy may be best for.
Interest-earning accounts & investments
1. High-yield savings account (HYSA)
Best for: Most people. While it may not be the most lucrative passive income strategy, a HYSA offers an easy, low-risk way to earn interest on cash you want to keep accessible.
One of the easiest ways to earn passive income is to park some of your money in a high-yield savings account. These accounts work like a standard savings account, but with one very important difference: you can earn interest on the money deposited — and at a rate that is typically much higher than the national average.
While HYSAs aren’t designed to produce outsized returns, they can yield from a couple of dollars to hundreds or even thousands of dollars a year, depending on how much money you’re holding in the account. Interest rates (also known as APYs) vary by bank and can change based on the current economic climate, so it pays to shop around for the right fit.
High-yield savings accounts at a glance
Effort: Low. No ongoing management beyond opening and funding the account, then occasionally monitoring the rate to see if a better deal becomes available.
Return potential: At the time of writing, competitive rates generally range from about 3.5% to 5% APY.
» See what you can earn: Compare high-yield savings accounts
2. Certificates of deposit (CDs)
Best for: People who don’t need immediate access to the money they deposit but would eventually like to use their earnings toward short-term savings goals.
A certificate of deposit is a type of savings account that pays you a fixed interest rate (either monthly or annually) in exchange for locking up your money for a set period of time. Unlike high-yield savings accounts, a CD’s interest rate won’t change during the term.
The tradeoff here is limited flexibility, as you’ll usually pay an early withdrawal penalty if you access your funds before the CD matures. Terms for CDs can range from 6 months to 5-plus years.
Like high-yield savings accounts, CDs won’t produce larger-than-life returns, but if you have cash you won’t need for a while, it’s a low-risk way to grow your savings.
CDs accounts at a glance
Effort: Low. Setting up a CD account can take less than 20 minutes. No ongoing maintenance other than waiting for it to mature.
Return potential: At the time of writing, the highest CD rate on our list was around 4.27%. If you invested $10,000 in a one-year CD at that rate, you’d earn about $430 in interest.
» See what providers are offering now: Compare CD rates and terms
3. Bonds and bond index funds
Best for: Investors seeking steady income and diversification.
Bonds are a way for investors to lend money to companies — as well as federal, state and local governments — and collect interest income. They are considered a safer investment than stocks, but also generally earn a lower return on your investment. You can either invest directly in a bond or in a bond fund, which is a collection of bonds, through a taxable brokerage account.
Nerd Tip: If you have a 401(k), chances are part of your portfolio is already invested in bond funds. As you get closer to retirement, portfolios often shift toward a higher percentage of bonds to help reduce risk and preserve gains.
Bonds at a glance
Effort: Low. Selecting individual bonds or funds, purchasing through a brokerage and holding them while collecting interest income.
Return potential: Depends on the bond you buy and the amount of time you hold it for. So far in 2026, the average yield for a U.S. Treasury security with a 10-year constant maturity is about 4.3%.
Dividend investing
4. Dividend stocks
Best for: Long-term investors who are comfortable are comfortable researching individual stocks and managing the tax consequences of dividends.
One way to build a passive income stream is to invest in dividend stocks, which distribute part of the company’s earnings to investors on a regular basis (typically quarterly). Dividend stocks are typically less volatile than other types of stocks, so they can help diversify and even stabilize your investment portfolio, too.
Ideally, the best dividend stocks increase their payout over time, helping your future income grow. Investors can also choose to reinvest dividends back into the stock, potentially increasing their investment if the stock does well.
Dividend stocks at a glance
Effort: Moderate. Researching individual companies, monitoring dividend sustainability and managing tax implications of payouts.
Return potential: Dividend stocks range in their payout. At the time of writing, the stocks on our list of dividend aristocrats (historically stable dividend stocks) range from over 4% to 5%.
5. Dividend funds
Best for: Investors who want dividend income but don’t want the responsibility of choosing individual stocks.
You can also invest in dividend index funds or dividend ETFs rather than picking and choosing individual stocks to buy. These funds tend to hold a well-rounded selection of many stocks that aim to mirror the performance of a given index.
A dividend ETF or dividend index fund will invest in a selection of stocks that pay dividends, which are regular payments that you could either cash or reinvest. This is a form of passive investing for those who prefer a more hands-off approach.
Dividend funds at a glance
Effort: Moderate. Choosing a fund, investing in it and periodically reviewing performance and payout consistency.
Return potential: More stable than individual stocks. But similar to dividend stocks, dividend funds vary in their payouts. At the time of this writing, the yields on our high-dividend fund list range from 4% to 9%.
Real estate and sharing economy
6. Real estate investment trusts (REITs)
Best for: Investors who want real estate exposure without owning property; retirees.
If you want to build passive income from real estate without the fuss and bother — not to mention the hefty down payment — of buying and managing properties yourself, real estate investment trusts (REITs) may be the answer.
Similar to mutual funds, REITs are companies that own commercial real estate, such as office buildings, retail spaces, apartments and hotels. When you buy a share, you are investing in them rather than purchasing them outright.
REITS tend to pay high dividends, but they vary in complexity and availability. New investors may want to stick to publicly traded REITs, which you can purchase through an online broker and are publicly traded on stock exchanges. You can also diversify your real estate holdings by investing in mutual funds or ETFs that track multiple REITs.
REITs at a glance
Effort: Moderate. Researching REITs or REIT funds, purchasing shares and monitoring performance and dividend payments.
Return potential: Often higher yields than stocks. REITs must pay at least 90% of their income to shareholders. At the time of writing, the five-year return of the best performing mutual fund REITS on our list ranged from 5% to 6%.
7. Renting out a room
Best for: Homeowners with extra space and time to manage tenants; renters looking to maximize their budgets.
If you're looking to get into real estate, you can start small by tapping into the sharing economy. If you own your home, the rent you charge could help you make a dent in your mortgage and possibly even set aside some money.
If you don’t own, getting a roommate could still provide some passive income in the form of savings. For example, according to Zumper's November 2025 National Rent Report, the median monthly rent for a one-bedroom residence in New York City is $4,330, but a two-bedroom averages $5,080 per month — meaning if you split the total with a roommate, you'd only have to pay $2,540. That's a monthly savings of $1,790 versus if you lived alone.
As with all income streams on this list, it’s worth weighing whether the downsides are worth the savings. Renting a room can mean sharing a bathroom and fridge space, and navigating everyday life with another person in your home. You may also want to look into housing laws in your areas to understand your rights if things go south with your roomie.
Rental income at a glance
Effort: High. Finding and screening tenants, managing shared living arrangements, handling communication and complying with local housing laws.
Return potential: Depending on where you live, you could earn — or save — a few hundred dollars to over a thousand dollars a month versus living alone.
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8. Rental properties
Best for: Investors with capital, risk tolerance and time (or money to outsource management).
Investing in real estate to earn rental income is another way to build passive income. Long-term rentals can provide a reliable source of cash if they are located in a healthy market for renters, but they also carry long-term stressors like maintaining those properties, and paying multiple mortgages, property tax bills and other costs. Additionally, there’s the burden of communicating with your renters — something that could eat up a good chunk of your time.
Rental properties at a glance
Effort: High. Managing listings, communicating with guests, coordinating cleaning, adjusting pricing and staying compliant with local short-term rental rules.
Return potential: Earnings depend on location, seasonality and demand. For example, Airbnb estimates a two-bedroom home in Los Angeles could earn over $2,000 for a weeklong stay, before expenses.
Asset-based side income
9. Parking space rentals
Best for: Urban residents with unused parking near offices, transit hubs or event venues.
In some areas, parking spots are a hot commodity. People who live in apartment buildings or homes without parking spaces may be interested in renting out a spot to avoid the hassle of street parking. If you have extra space in your garage or parking area, you can consider renting the space to a local. How much you make depends on where the going price for parking space rentals in your area.
If you live in a city, near a concert venue or any area that can attract a crowd, you can also consider using the Spacer app, which allows you to rent out a parking spot on a more temporary basis. You'll need a few photos of the spot, the dimensions and details on the spot's security, access and distance from public transit.
Parking rentals at a glance
Effort: Low to moderate. Creating a listing, coordinating access and handling occasional renter communication.
Return potential: Low to moderate. Spacer estimates the average host earns about $200 to $300 per month, though high-demand locations can earn more.
10. Car advertising
Best for: People who drive frequently, including commuters, rideshare drivers and delivery workers.
If you don’t mind making some cosmetic changes to your car in exchange for extra cash, car advertising — sometimes called car wrapping — may be a passive income stream to explore. How it works: companies pay drivers to wrap their vehicles partially or fully with advertisements. Others offer digital ads that attach to a car's roof.
Rules and requirements vary by company. Some advertisers require that your car be no more than 10 years old, while others prefer to work with rideshare or delivery drivers who spend more time on the road. It’s also common for companies to set minimum mileage requirements or limit campaigns to specific areas, such as large metro or downtown regions.
Nerdy tip: Scams are common in this space. Be cautious of companies that ask for upfront fees, promise guaranteed earnings or pressure you to cash checks or send money back. Always research the company, understand how and when payments are made and review all terms before agreeing.
Car advertising at a glance
Effort: Moderate. Vetting legitimate companies, meeting eligibility requirements, scheduling installation and maintaining the advertising placement.
Return potential: Varies. According to Carvertise, drivers can earn between $100 and $400 per month, while Nickelytics reports that drivers typically earn $175 to $250 per month .
» Need money fast? Check out ways to make quick cash
Alternative investments
11. Peer-to-peer lending
Best for: Investors who want potentially higher yields than savings accounts or CDs and are comfortable taking on credit risk and limited liquidity.
An alternative to traditional bank loans, peer-to-peer lenders, like Prosper and Lending Club, match investors who are willing to lend money with borrowers who are vetted by the platforms for creditworthiness. It’s riskier than putting cash in a high-yield savings account or money market fund, but also potentially can earn more interest — as much as 5% or more.
Peer-to-peer lending at a glance
Effort: Low. Selecting loans, monitoring repayment performance and reinvesting returns, with some platforms offering automation.
Return potential: According to Prosper, the average historical return for their loans is 5.3%. Granted, each individual loan could vary from that. But if you loaned $10,000 out for a year, you could make around $530, not considering fees and taxes owed.
12. Cryptocurrency staking
Best for: Crypto investors who plan to hold long term and understand volatility and platform risk.
Crypto staking is a way of growing your holdings in certain cryptocurrencies by using them to help verify activity on an underlying blockchain network. When you stake a cryptocurrency, you can be rewarded with more cryptocurrency.
Staking, for most people, involves delegating your cryptocurrency to someone who is compiling records of transactions on the network on which it runs. Those verifiers need to put some tokens at stake to guard against fraudulent transmissions. By giving the voting power of your tokens to a reputable verifier, you can get a share of the rewards they receive for carrying out their job accurately.
But there is some risk: If the verifier you're working with is penalized, you may be as well. And staking sometimes requires you to commit your holdings for a set period of time, meaning you can't sell or trade them. Several crypto platforms offer staking programs. It's important to note that staking is not available on all cryptocurrencies — notably, Bitcoin does not support staking.
Cryptocurrency staking at a glance
Effort: Low to moderate for people familiar with crypto. Choosing a platform or validator, setting up staking and monitoring lockup periods and rewards.
Return potential: Varies by asset and platform. Each cryptocurrency has its own staking rate. For example, on Coinbase, Ethereum has a staking rate of 2.2% APY at the time of writing. That means if you had $10,000 in Ethereum, you could earn over $220 in one year.
13. Vending machines
Best for: Entrepreneurs who want a semi-passive business and can manage logistics locally.
Starting a vending machine business is a relatively inexpensive venture. You can purchase a machine for between $3,000 and $6,000 (possibly for less if refurbished). The trickier part is figuring out where to put it — gyms, offices and healthcare settings may have good foot traffic, but it may not be easy to get permission to unload your machine there.
Additionally, you may need to do some market research to figure out what types of inventory you would want to stock, and devise a system for tracking and replacing inventory as necessary.
Vending machine management at a glance
Effort: Moderate. Requires restocking, maintenance and location management.
Return potential: Moderate. Machines can make anywhere from $300 to a couple of thousand per month, with higher earnings possible in high-traffic areas.
Content- and product-based income
14. Downloadable digital products (courses, templates, spreadsheets)
Best for: People with specialized knowledge, creative skills or a defined audience who have the time to put upfront work into creating downloadable content.
Websites like Etsy, Udemy and Gumroad have made it easier than ever to sell digital products online. If you have a skill or area of expertise — whether that’s teaching a subject, building spreadsheets or designing templates — you can create downloadable content and sell it through one of these platforms.
One of the biggest advantages of digital products is their potential scalability. The goal for many people who choose this route is for the digital product to run largely on autopilot, requiring only occasional updates, allowing them to generate income long after the initial work is done.
That said, the upfront effort can be significant. Creating a course often involves outlining lessons, recording and editing videos and updating materials to stay relevant or meet platform requirements, though advances in AI may help reduce some of the time and labor involved.
Earnings also vary widely. Some creators publish multiple products and generate full-time income, while others may earn a few hundred dollars a month or less. It depends on the quality of the product, demand and how much effort you put into marketing and promotion.
Digital products at a glance
Effort: Very high upfront, low ongoing (potentially). Creation, testing and marketing take time, but maintenance is minimal.
Return potential: Earnings vary widely, but successful products are highly scalable. According to a 2024 analysis by SellCoursesOnline, the average instructor on the digital course platform Udemy makes $3,306 per year, with 75% of instructors making less than $1,000 a year. The top 1% of instructors make more than 50% of all Udemy earnings.
15. Written content creation (blogs, newsletters)
Best for: Strong writers with niche expertise and patience to grow an audience over time.
Substack and other similar platforms have made it easier than ever for writers to generate passive income while doing something that comes naturally to them. Advertising, affiliate links, subscriptions or licensing are just a few avenues for monetizing output
That said, content creation typically involves upfront and ongoing work. Building traffic, maintaining search visibility and keeping content up to date require time and consistency. While income can become more passive over time, most writers will need to publish pretty often to gain traction.
Earnings also vary widely and depend on audience size, topic, monetization strategy and how long the content has been live. A review of Reddit threads on the topic of Substack profits doubles down on the variance: While some people report making up to $20,000 annually, others make far less, citing as little as $12 monthly.
Written content creation at a glance
Effort: High. Creating a website and/or signing up for an email platform, writing, advertising and learning about SEO and search visibility.
Return potential: Highly variable. Written content can be monetized in multiple ways but exposure and method of monetization can make or break whether the venture is profitable.
16. Video content creation
Best for: Creators comfortable being on camera who enjoy production and audience engagement.
These days, another popular way people aim to make passive income is through social media content creation. If you meet certain requirements, companies like YouTube and TikTok may pay you for simply posting on their platforms.
If you gain a following on social media, that also opens the door for sponsored content, in which a company will pay you a fee to post about their product.
You may, however, find that creating content is not as hands-off as you might expect; there's always pressure to create more content or update what you have to keep it viable.
Creating online content, like most forms of passive income, can have a wide range of payouts. For social media content creators, it's estimated that "nano-influencers," people with 1,000 to 10,000 followers, may charge anywhere from $5 to $25 for a single TikTok sponsorship, according to Influencer Marketing Hub.
"Mega-influencers," those with 1 million or more followers, on the other hand, may charge more than $2,500 for a sponsored TikTok post. These rates increase for sponsored content on Instagram or YouTube.
Video content creation at a glance
Effort: High. Planning, filming, editing and staying relevant require regular work. Requires consistent publishing, SEO or audience growth.
Return potential: Highly variable. Income can come from platform payouts, sponsorships and licensing, with top creators earning significantly more than average. Can range from a few dollars a month to full-time income through ads, subscriptions or affiliate links.
A final word
Saving money doesn't technically create passive income, but one of the best ways to "make" money is to not spend the money you have — and unlike other passive income ideas, doing so doesn't require an initial investment. Here are a few easy ways to save money:
Track your spending. Knowing where your money is actually going is crucial to cutting back. If you track your spending over the course of a month — either manually or with a budgeting app — you'll likely find small, mindless expenses add up to big savings if you can wipe them out.
Reduce your electric bill. Lowering your electricity bill isn't just about turning off the lights. Doing an energy audit can highlight other ways to cut costs, and some community organizations or local governments offer this for free (or with the cost heavily subsidized).
Cancel unnecessary subscriptions. According to a June 2025 CNET survey, U.S. adults spend around $90 per month on subscription services. Schedule regular audits to make sure you're actually using everything you're paying for.
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