Generating passive income as a freelancer is inherently complicated. Why? Because freelancing, at its core, is built around trading money for completed hours or tasks.
It’s one of the most simple business models around—which is probably why it has lasted so long. You do work for a client. The client pays you. It’s easy, clean, simple, and has provided millions of people with a sustainable business and flexible lifestyle.
But some freelancers, after spending a lot of time just trading work for money, want to expand their opportunities and build passive income into their freelancing.
Passive income can mean a nice little boost of revenue every month without much (or any) extra effort on your part.
So today, for freelancers who are ready to grow their revenue this year, I’d like to share a few easy-to-try ways to build passive income into your current business model. I’ll offer a few examples along with each idea so you can get a feel for what it might look like in real life.
Let’s dive in:
Here are 4 ways you can build passive income into your freelance business:
One of the quickest ways to start making a nice bit of extra passive income is to recycle (or upcycle) any unused elements of your work.
I’m not talking about including extra stuff in your portfolio (although that never hurts), I’m talking about actually making new, passive money from things you’ve already created that clients passed on.
If you’re a writer, you may have articles or sales emails that your client never picked up. If you’re a designer, you probably have vectors, backgrounds, or layouts your clients passed on in early proof rounds. Designer Ben Brush packaged up unused designs and now offers them as a free lead magnet on his website to attract potential new clients.
As long as you still own the copyright to these elements, you can package them up and sell them on your own site or through an array of different marketplaces.
Finding a new round of customers (which tip #1 would require) doesn’t always sound all too interesting. Why not stay focused on building passive income through the clients you already have?
One simple way to do that is through a value-add upsell you can offer to your clients – but not with added time or effort.
If you’re a freelance social media manager, for example, you could write a social guidelines book for your client to distribute to their other hires. You write the guide once and can upsell it to new clients as well, over and over again.
Bobby Macey of Macey Media offers his clients a content ideas & suggestions schedule delivered through a shared Google calendar. His clients pay a flat fee every month (which can really add up) and they reap tons of value from his tips sent multiple times each week.
As a freelancer, you’re accustomed to doing work once and getting paid once.
But if you want to build passive income into your business, you have to start thinking of ways to do work once and get paid over and over again for that work.
Ask yourself, “What kind of work do I create on a daily basis that I could turn into a long-term asset?” This should start kicking off a bunch of passive income ideas in your mind.
For example, if you’re a blogger, could you compile a collection of your articles into an ebook and sell it on Amazon or through your own website? If you’re a coach, could you compile some of your best training videos into a course that you then sell on sites like Udemy?
Once you realize you can “double-dip” on many of your one-time projects, it can be exciting to watch your collection of monetizable assets grow and grow. Then, with some hustle and hard work, you can convert those into passive income.
Freelance Coach Rhonda Page told me she’s in the process of doing this right now. She’s recorded hundreds of hours’ worth of webinar video. She’s going through it to find her best work and compile it into a value-packed video course.
There are always more opportunities for capturing additional revenue from the work you’re already doing.
In addition to upselling clients (mentioned in point 2), promoting affiliate products to your clients is another way to generate passive income.
To put it extremely simply: affiliate marketing is an arrangement where a company pays commission for traffic or sales generated from its referrals. In other words, for every client that signs up after you recommend a service, your affiliate partner will give you a commission.
If you’re a graphic designer, you can recommend your client sign up for stock photo sites or graphics marketplaces who will then give you a small commission every time that client makes a new purchase or renews their monthly subscription.
Here’s a clear example:
If you’re a WordPress developer, you might recommend to your client that they upgrade from basic hosting to a more robust hosting option like Flywheel, who will then pay you up to $500 in commission. Not bad!
Creativity is the name of the game with affiliate marketing. That and a clear, obvious, value-added tie-in. People can tell when you’re just peddling your wares, so be sure your recommendation adds value to your client projects. If the value is there for the client, you’ll collect a nice referral fee to add passive income to your freelancing process.
Passive income is about short-term effort and long-term patience. For some freelancers, passive income may feel like an elusive golden egg. Maybe you’d be happy just to conquer the feast or famine cycle and build some predictability into your business.
But for freelancers who are already stable in their business and they’re looking for ways to take things to the next level, passive income is a great avenue to explore.
Of course, there are a million ways to approach passive income. The ideas I’ve presented here are just four examples of pro tips to get the wheels turning for you. For early success in passive income, brainstorm ways you can generate new, long-term revenue from work you’re already doing. Once one tactic shows promise, you can invest more time and effort there to really grow your passive income as a freelancer.
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