Developers working as freelancers always think that they will get paid when they work for clients and not when one stops working for them. It may sound correct, but then there are many ways even developers can generate a lot of passive income online.
When I mean passive income, I mean passive income. Income where you don’t have to lift your finger even to get cash into your bank account.
I am damn sure you doubt developers can make passive income, and rightly so. It is tough to even imagine about generating passive income for freelancers. So developers don’t stand a chance.
But I will share exactly how I generate passive income and how any developer can generate passive income online.
No, I am not talking about investing in real estate and renting it out as an option for passive income. I am not a fan of passive rent income because it has a lot of documentation overhead, at least here in India.
So what is my view of passive income?
Passive income is the earning of a person who doesn’t require an active involvement to generate the earnings. In other words, passive income requires little to no effort to keep on earning and even grow revenue.
I considered an income passive when I don’t have to do anything to get the money into my bank account. We will now look into how developers can use these seven ways to generate passive income for themselves.
The best and the most effective form of passive income for me is the income from my investment in the stock market in the form of dividends.
Yes, I do a lot of research in my stock investments, but once I am invested in a stock, it is forever. However, I do chop and change my portfolio, but my view is to remain invested in stocks forever. The income I get from the dividends these companies pay is passive.
I am in the stock market since 2007 and has seen the crash of 2008. However, the stock market is not for everybody. If you aren’t sure about investing in stock, mutual funds are also the right choice. One can invest via as little as ₹500 per month via the excellent quality large or midcap fund dividend option via the SIP method. Once you do that, one can make 2% of the total invested amount as dividends.
I know 2% may not sound too much, but I make more than $1500 or ₹100k per year as dividend income with my large portfolio. The best part is, it comes to my bank account without me even require to do anything. When I mean anything, anything means absolutely anything.
I am so thrilled with the dividend income that I am always looking for companies that pay a fair amount of its earnings as dividends. Completely passive for sure, but more so, the value of your investment keeps increasing, and so you make more dividend income with time.
The next best option for developers to make passive income online is to recommend SaaS products that pay recurring commissions to affiliates.
Let me share my story here for you to understand better.
I am an affiliate of AWeber and recommend it to my clients as well. I have been recommending AWeber for a very long time to every client looking for a professional level email marketing services.
You can see I have been actively recommending it since 2009. As of now, I am not taking up many new clients, and so I can’t recommend it that actively. Yet, I am being paid for the clients I have referred to in the past.
However, one of my recent clients had a unique requirement. He wanted to compose an automated email from the forum threads. Alongside it needed data from WordPress as well as sponsors.
Email content fetched from the client’s server is not possible in AWeber. One can only have RSS feeds to create email content, but it wasn’t enough for this client’s requirement.
This is how I ended up with Moosend. They offer email campaigns that pull the HTML from your site.
I developed the code for pulling data from vBulletin forums, WordPress as well as newsletter sponsor system. Then tied everything to send the email daily using Moosend. So, I recommended Moosend to my client, and that way, I am making a passive income for it, similar to AWeber.
I liked Moosend so much that I started recommending them over AWeber.
Try to recommend products that offer recurring commission but don’t base the recommendation only based on commission. The idea is the client remains with the service provider for an extended time to make a decent amount of passive income.
Let me share one more choice I use, which is Cloudways. I recommend them to my clients who are looking for virtual dedicated servers on Linode or DigitalOcean.
Cloudways isn’t for everybody. It only works for clients on shared hosts and has a reasonably large site and now want to move towards a virtual dedicated server.
If you recommend Cloudways to clients who are starting a new site, it may not be very long before they stop, and you don’t keep on making the passive income.
They pay recurring commissions, but the percentage is lower. However, everything adds up to the overall passive income I make for recommending SaaS products.
You are a freelance developer, and you know everything about things you are developing. Clients don’t know a lot about the internal functioning of the system.
However, what a client wants is peace of mind for the software that is powering their website.
You can offer a service where you will always be available with a concise turnaround for any website issue. The client can subscribe to your services for a monthly retainer fee.
Ideally, I prefer to use a $50 or $100 PayPal monthly subscription to offer clients. For a small amount that the client pays, I keep their CMSed updated and check for the backups and everything. Moreover, if there are any minor changes needed, do it for them.
Most of the time, there is very little to no work that needs to be done, and I still make the amount as a completely passive income.
For WordPress, there is SaaS software that can do the upgrade. So, they worked well in the past, but now, there is very little that one can do with automatic updates.
However, I still have clients who want me to be on retainer for anything critical that can come up on their site. They like my fast turnaround time of under 24 hours, for which they only need to pay a minimal retainer fee.
Although I only take up one or at the max two such clients.
You are a developer, and you know what other people are looking for as a product that you can develop and either for it for free or even put a price to it.
There are numerous examples of many such paid WordPress plugins. The one that I can think of is Yoast SEO for WordPress. It is one of the most popular SEO plugins for WordPress, and it is on the list of most essentials of WordPress plugins. There is a free version, but there is also a pro version that customers pay every year for updates.
Quite a passive income in nature.
Similarly, WP Rocket is an excellent WordPress performance improvement plugin that people buy and use despite the fact there are many free alternatives.
As a developer, if you understand your clients’ pain points and develop a product or services, you can make a lot of passive income online.
As a developer, if you wish to create a passive online income, you have to develop products that can sell without your intervention.
A programming course on Udemy is one such good example. I have explained the same from a JavaScript Programming point of view in this article. The idea is to create a course on a programming language you use day in and day out. I am sure you can make the course much better from a practical perspective and quite different from already available.
Similarly, one can also write a book. I have written a book not on programming but on investing in the right stock in the market.
I have shared the complete process to self publish the book with Notionpress.
You don’t need to lift a finger to print, ship, and get paid for each copy you sell. The income is passive.
Upselling is a sales technique used to get the client to spend more by buying an upgraded or premium service of what’s they are about to purchase.
As an example, if you walk into a mall to purchase a TV, you will see a vast curved LED TV that looks stunning. The sales team will try to upsell you to buy a better TV.
Similarly, you can package your services for upselling.
Again, you may be thinking upselling is an active income of whatever you are doing. The point to note here is one can always upsell to be a retainer. Similarly, one can sell the products you have developed or let the clients know about the functionality you developed in the past and how it helped the client with more revenue.
I always keep such a functionality handy that works for my existing client. Like I said about Moosend. The client traffic doubled for whom I developed a daily newsletter’s functionality using vBulletin forums, WordPress, and sponsors.
Moreover, because the newsletter is sent daily, there are many more advertisers and sponsors.
I recommended the same to one more of my clients in XenForo, and they are actively looking into it.
If the client wishes to go with similar functionality in XenForo, I will be paid to recode it in XenForo. Moreover, I can recommend them Moosend again for yet another passive income opportunity for me.
Finally, I will say a blog is an excellent source of passive income online for developers.
One of my articles from 2007 still ranks in Google and brings me traffic to my Go4Expert Programing site.
I don’t rank in the first position, but the article ranks well in Google because it is still relevant. Moreover, it still has everything one needs to understand the Design Patterns.
It brings me many page views even today, so I still make money from traffic because of Adsense. Hundreds of such articles as an archive over time means you earn significant income passively from Adsense.
In every other niche, the article may become obsolete, but certain things don’t become obsolete in programming.
Similarly, as you learn new things, you can share to create a repository of code. Traffic will trickle in when people are looking for something related to what you have shared.
Again, don’t take me that content will take care of itself and you don’t need to promote it either, but what I am saying is if you do a little promotion initially, you may end up with a lot of passive traffic to your site that can help you make a lot of passive income.
Passive income is all about working once and getting paid in a small amount over a long time. So if you are looking to build something that is completely automated and wants it to be online overnight, you will be disappointed. However, if you give time, I am sure you can generate a lot of passive income online.
Always remember this Bill Gates’ quote.
Most people overestimate what they can do in one year and underestimate what they can do in ten years. – Bill Gates
So focus on building a passive income online over a long period, and I am sure every developer can build it.
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