- I want to make sure I have passive income in the event of a recession, so I asked the experts.
- Financial planners recommend investing in self-storage and other real estate, including REITs.
- Self-publishing books, renting out your stuff, and opening a savings account or CD are other options.
As an entrepreneur running a service business in the wedding industry, I’m always looking for ways to bring in new sources of passive income. I don’t want to work more than 50 hours a week, and to maintain that work-life balance, I’ve found I need new ways to generate income that don’t involve as much of my time.
Over the years, I’ve earned passive income selling online courses and eBooks, and doing affiliate advertising on content I create for my own website or on social media.
With the speech of a potential
approaching, I found myself nervous about having to find new ways to make money. That’s why I asked financial experts to share recession-proof passive income streams that might be worth considering in 2022.
1. Invest in self-storage
If you have the cash on hand and are looking to start a new business, financial planner Tammy Trenta says it might be a good idea to consider investing in self-storage facilities.
Since recessions can cause people to sell their homes, downsize or temporarily move to new locations, investing in self-storage facilities could not only be a good investment, but also a good source. passive income.
You can invest in self-storage facilities in a variety of ways, whether you want to purchase your own facility or invest in specialist REITs (real estate investment trusts) that already operate a large portfolio of self-storage facilities .
2. Rent a popular item
One way to start a passive income stream is to look around your home and see what you have that other people are eager to rent out.
Financial planner Marli Erickson says if you have the capital available, you might even consider buying a high-demand item to rent out.
“During a recession, individuals do more of the tasks themselves that require specific equipment and tools,” says Erickson. “Take the example of a utility trailer. Your investment will be around $2,000 and you can put a picture of the trailer on your Facebook page and put signs on it saying it’s available for rent. »
In this example, she also advises adding a truck, tools, gardening equipment, tents, and sporting goods for a larger inventory.
You can list the items you want to rent to others on a variety of websites like Friend With A or Loanables, and each time the item is reserved, you can pocket the money.
3. Build a real estate portfolio
Real estate is a source of passive income that also comes with tax advantages, and one that financial planner George Nicola says is worth considering in a recession.
“Passive income derived from term rents and leases is recession proof and has a low correlation to the market
“, explains Nicholas.
Although owning real estate may require active management to maintain high occupancy and maintain the property, you can also consider investing in dividend-paying REITs as another way to earn passive income. .
4. Self-publish books
If you’re someone who loves to write or has always wanted to write a book, financial advisor Joseph Hogue says self-publishing books is a great way to earn passive income during a recession.
“Everyone has a book idea in them,” says Hogue.
Once you know what you want to write about, Hogue says it’s not only easy to self-publish the book (using platforms like Amazon Direct Publishing or Barnes and Noble Press), but you can also Selling the book at a price low enough for a recession to win’ doesn’t affect people’s decision to buy it.
While it’s not easy to become a successful self-published author, Hogue says the benefit of publishing your book and putting it on a book retailer’s e-commerce platform (like Amazon, Apple Books or Barnes and Noble), is that you could get traffic from people searching for books daily, as opposed to just writing blog posts on your own website (which might only attract a limited audience and more restricted).
According to a self-publishing resource website, authors can earn $1,000 a month selling their own books.
5. Open a savings account
While opening a savings account won’t net you thousands of dollars in passive income every month, unless you have a ton of money to put aside, financial planner Susannah Snider says it is always worth considering.
That’s because Snider says interest rates tend to go up, and while the national average interest rate for savings accounts is 0.1%, you might be able to get a rate at north of 1.5% in an online bank.
Plus, she says, “if you can lock money in for a bit longer — one or five years, say — in a certificate of deposit, you can find rates hovering around 2.5%.”