By Courtney Rosenfeld
Freelancing gives you great control over your career, allowing you to determine where you focus your energy. However, one drawback of freelancing is that you can’t fall back on a monthly paycheck. This can be especially frustrating when dealing with cash flow issues due to a dry spell of work or late-paying clients. Setting up passive income streams can help in these scenarios. SMB CEO explains the benefits of passive income, noting that it doesn’t eat up much time and can provide for a more financially stable future. This step-by-step guide for freelancers (presented by Wordnetic) provides advice for those looking to boost passive wealth.
Consider Your Current Skills and Resources
Before launching a passive revenue stream, assess the resources you currently have at your disposal. For example, if you already have a thriving social media following, affiliate marketing can be a great option. Alternatively, if you work as a professional blogger, you might sell ad space on your platform. Blogsvertise can help you maximize your social media and blog impact and reach, enhancing your passive revenue. These professionals connect influencers and brands to boost your visibility.
Decide What Type of Passive Income You Want to Pursue
In addition to considering your existing resources, assess your professional strengths when selecting a passive income stream to pursue. Liquid Planner provides tips for figuring out where you excel, such as soliciting feedback from others and identifying those tasks you enjoy the most. With this information, you can make an educated decision on what type of passive income stream best suits your style. Check out this list of passive income ideas from Side Hustle Nation, which covers everything from podcasting to dividend investing.
Figure Out What Materials, Tools, Permits, and Licenses You’ll Need to Get Started
Once you’ve chosen a revenue source, you can invest in the necessary materials and tools you need to make your vision a reality. For example, if you want to sell podcasts, you may need professional audio equipment. Also, check whether you need any business permits or licenses for your chosen side hustle. What licenses are needed to start a business in your state? Service providers like ZenBusiness can simplify the research process by compiling a report of permits or licenses required in your area.
Establish Your Passive Revenue Stream As an Official Business
Before you commence business operations, consider establishing your passive revenue stream as an official business entity. Bench explains some of the most common structures, including a limited liability company, s-corporation, and partnership model. Each of these entities has different requirements in terms of tax obligations and reporting, so do your research before settling on a structure. For example, some entities offer greater personal liability protection than others.
Look for Ways to Scale Up, Cross-Pollinate, and Diversify Your Passive Revenue
Once your passive income is set, look for ways to scale up. For example, if you’ve invested in real estate, you might take the returns from your first property to buy another one. You can also look for ways to cross-pollinate. Say you’ve successfully invested in dividends, for example. Why not sell a course explaining how you did it? This also allows you to diversify your income. Trillium Financial explains that diversification supports greater financial stability.
Setting up a passive income stream as a freelancer will require some initial effort. However, the financial stability it will bring you will be well worth it.
Wordnetic curates freelance jobs for copywriters, social media managers, content writers, and journalists. Visit the site today to discover your next gig!
About the author
Courtney started Gig Spark to be a resource and the first step for people who are looking to join the gig economy, either to supplement their income or as a way to fulfill their dreams of becoming an entrepreneur.”