I’m going to list ways you can generate a substantial income without having to work for OT,  now this is something I haven’t written about In a while. And that can make some people cringe as if they’re going to be invited to an MLM seminar at the Westminster hotel and that is passive income.

It’s a concept where you essentially do nothing all day where you sit at home and make money from any where in her world,  and it’s an interesting to say at least.

After all,  who wouldn’t want to make money without having to work, Hut the good news is that there are actual legitimate ways to make passive income that don’t require a lump sum investment and don’t involve you being sulked into an MLM scheme  and don’t involve you being sold into a pipe dream. And you can do that with little as $500, however I want to be frank on your expectations that $500 is not going to end up making you filthy Rich to the point, where you can quit your job and stay home all day watching Netflix, bit the good news is once you own any amount of passive income, oh a $500 investment,  that’s going to be enough to get you do excites to want to grow into something bigger and the strategies that you would have learned today should rest just become the catalyst that would lead to much higher numbers in the future.

So here’s where you can start with as little as $500 and everything I’m about to mention us something I’ve done personally. So first, it’s important to understand that when it comes to passive income they’re 2 very different type that you can generate for yourself, the first one is by investing your money and the second one is by investing your time.

And I’m going to give you options for both of them in this article, so don’t skip.

Now let’s start with how to invest your money,  the point of this is to get your money working for you so that your money can make you more money and if it can make you more money, take it that every 1 dollar you invest is going to find pennies to deposit back into your back account and in investing that might not seem that much to put up a dollar to work just to go and buy you pennies but all of a sudden when you get shoulder and thousands of workers out there all bringing you pennies it begins to add up to a substantial amount,  and then on top of that once a penny joins your army, that penny new job is to go and find other pennies to recruit into your bank account and that makes you even more money that’s really the basis for investing your money for passive income and it all begins right here.

The first is to invest in an index fund: an index fund is basically a broad investment that covers a wide variety of stocks and investments that you can buy into that for a very low price. Eg UTSAX is going to cost you $80 a share and for that small price you will own a tiny piece of the entire US equity market and the good thing with this index is there’s a index for every single maker out there and so you can use that to make passive income. If you want to invest in the top 500 publicly traded companies in the US,  you can go and invest in SCHB,  FXLAX and all of a sudden you’ll get access to $500 companies for a very low cost, the good news with this fund is that you can make passive income in two different ways, the first is from the stock price going up over time, and the second is going to be though their dividends.

Now in terms of how much the stocks goes over time, you can see historically it’s averaged about a 5-7% return adjusted for inflation, though obviously some years you’re going to end up making more money than the rest and other years you’re going to end up losing some money but long term, historically it’s always trended upward and then on top of that like I mentioned you have a dividends and in most of these companies it pays about 1.3- 1.8% to annually which really might not seem like a lot of money instinctively because with a $500 investment, we’re only talking about making a 5-7 dollars a year but with when you also consider that the stock price is going up by another 5-6% a year, that would by your overall return on a $500 investment to be about, 30-40 per year with no work whatsoever and they’re other that what your main focus is,  for recant we have high income funds as possible like with this one, SPHIX would give you a 4.7%  passive income with no ongoing work on your end. Whatsoever plus you get to see the price of the index fund go up over time.

The options don’t just end there, either there’s an index fund for pretty much anything or industry that you could think of, all to go is go to google. I know all this money is not life changing buy tryst me, when I say this that once you see your fund dividend being deposited into your back account for doing absolutely nothing, beside just making the investment. It’s addicting and you’re hoing to want to send, even more of your money to work for you, just so that they can make you even more passive income in the future than imagine over time let’s say you invest,  500 a month into an index fund Over 35 years that would turn into a 1.2million that’s going to be bringing you 22k a year in passive income plus the fund itself is going to be going up in value on and average of 60k a year,  so trust me it all begins with something small but it’s going to grow in something substantial overtime and it all beings today.