Passive income investments can make an investor's life easier in many ways, particularly when a hands-off approach is preferred. The four options outlined here represent differing levels of diversification and risk. As with any investment, it's important to weigh the anticipated returns associated with a passive income opportunity against the potential for loss.
Passive income, in a nutshell, is money that flows in on a regular basis without requiring a substantial amount of effort to create it. The idea is that you make an upfront investment time and/or money, but once the ball is rolling, there's minimal maintenance required going forward. That being said, not all passive income opportunities are created equally. For investors, building a solid portfolio means knowing which passive investing strategies to pursue.