Let’s recap what my blog posts have talked about in the past in regards to making passive income on the internet.

Mindset
First of all, the mindset. The mindset must be right. Making passive income isn’t about getting rick quickly (for that, you are looking at high risk investments and activities such as gambling and any type of short-term trading).

Getting something for nothing simple doesn’t work, and if you are really determined to make passive income online, then be prepared to work hard - at least initially. The thing that sets earned income and passive income apart is that with passive income, you are able to gain future income without having to work for it, but this is not to say that you will never have to work for it. Passive income is the result of once earned income - engrave this in your brain.

Learn as much as you can about internet business, and investments. If you have read Robert Kiyosaki’s Rich Dad Poor Dad or The Cash Quadrant, then you are familiar with the four quadrants. You want to have the mentality of an investor and business owner. Those two type of people have one thing in common - they look for high-leveraged opportunities.

Empower yourself with knowledge, just enough to get you going, and not too much for you to over analyze and paralyze. Some people think going into a particular type of business or investment is risky. Well, that’s because most likely those people don’t have any knowledge in the type of business or investment they are getting into. Risk is in the eyes of the beholder.

Get Comfortable With Selling
Ok, now that we have established the right mindset to start building your passive income online for life, let’s start selling. “What? Selling? But I don’t like selling!”, that little voice in your head is probably screaming right now. Relax, and admit it, professional sells is one of the top, best paying profession in the world, and there is a good reason for that. Believe it or not, even if you work for someone else (aka you have a J.O.B), you are still selling - you are selling your skill to your employer. Most people associate selling to car salesman, but the truth is there are many type of sales you can get into.

Be Careful What You Sell!
Some things you sell will only pay you once. In other words, you get paid only so much as what you sell - such as going to work for 8 hours and get paid for those 8 hours, or get paid commission once for selling a car, a piece of real estate, etc.

There are affiliate programs that can help you build passive income online - ones that pay you recurring commissions. Many web hosting referral programs were like that, but nowadays many have opted to pay just once due to stiff competition in the hosting industry. Look for affiliate programs where the nature of their business is of a membership or a recurring service, where customers pay a monthly subscription. Most likely the merchants will also pay out recurring commissions.

Internet marketing memberships tend to have recurring commission, have a look at these recurring commission products:

Earn $1,000 A Day Membership

Blogging to The Bank

Lazy Affiliate System

Some programs has a 2-tier structure or multiple tier structure where you can actually refer an affiliate, and earn a percentage from the affiliates’ commissions whom you have referred.

Many CPA networks have a 2-tier affiliate program.

Climb To The Top Of The Food Chain
While selling an existing product or service of another merchant seems like easy money (afterall, you don’t have to create the product or service yourself), keep in mind how much more money you could have made if you had owned the product or service yourself (it’s like keeping 100% commission :)).  Also, keep in mind, when you are the owner of a product or service, you can recruit affiliates and have them sell for you.  See Big Money Writing Little Books.

Make and Keep As Much $$$ As You Can Today
The other approach to making passive income online is to start making and keep as much money as you can today, doing whatever that it is you do (employee or self-employee) and then transition yourself to become an investor.  When you make investing as your business, you are now leveraging your money - you are putting your money to work for you.

There are many online investment opportunities that you can get into, once you have some money in your pocket.  For example, you can buy domains that have existing traffic, and make passive income from them.  You can also purchase established websites that require little attention and just have them run on autopilot.  If you are not familiar with buying a web property (be it a domain or a website), then start out small.  There are many revenue generating web properties that are just waiting for buyers to snatch them up, and for a very good multiple, too.  A typical web property investment will have a break even price of 2 - 3 years, which is much faster than a brick-and-mortar business, and much higher ROI than a real estate rental property.

More to come later…