5 Easy Passive Income Method

Passive Income is the income that we earn with little effort involved. Having a multiple passive income will help you to create wealth and also let you to have more freedom in your life. Nowadays, many people are talking about financial freedom and one way to achieve it is to have multiple passive incomes which can cover the monthly expenses. For those people who still don't have any passive income, I think is time for you and your family to sit down and think about it. 

Please don't think that creating passive income is a difficult task and require a large amount of money. Actually it is fun and easy... even kids also can do it. Let me share with you 5 easy passive income methods you can start with... 

1. High Yield Saving Account 

Sometimes we might not notice what is our saving account interest rate because is it relative low. However, a 0.1% differences in long run will be a huge amount. Normally bank will give 0.1% - 0.3%. Let said, if you have 100,000 dollar in bank A with interest rate 0.1% and 100,000 dollar in bank B with interest rate 0.2%. If after 1 year you check at your account in bank A the amount will be 100,100 dollar and bank B the amount will be 100,200 dollar so we can see the difference is 100 dollar. With 100 dollar we can use it to buy stationary for our kids. 

2. Fix Deposit 

This is an investment tools created by bank, where customer agree to save some amount of money in the bank with a locking period and then customer will get a guarantee return. The return is normally between 2% - 4% per annual. No service and annual fee charge required. For example, just put 1000 dollar to fix deposit with a 1 year locking period and 3% return then after 1 year when your fix deposit maturity you will receive 1030 dollar which mean that you have a 30 dollar passive income. 

3. Unit Trust Fund Investment 

If you think Fix Deposit return is low maybe you can invest in some trust fund which give better return. These kinds of trust fund normally provide 6% - 20% return. However please carefully select the fund you going to invest because normally trust fund will have a annual fee charge. 

4. Stock Investment 

Stock investment is always treating as a favorite tool for passive income. The reason is because the access is easy and also the return can come from capital appreciation and dividend. However some might think stock investment is very risky. Well, with proper planning and analysis I think we can reduce the risk. One of the way to reduce the risk is to invest in dividend stock. This kind of stock can give 4% - 10% dividend. Normally dividend stock will have a good fundamental and strong management so if any market crash they still can withstand it. Examples of dividend stock in Malaysia are BAT, Dutch Lady, Digi, Public Bank, Nestle, Guinness, Carlsberg and Telekom Malaysia. 

5. Pension Fund 

Pension Fund is also one of the passive income that for longer term. The objective of Pension fund is to provide a measure of security for the retirement to its member. In some country pension fund is a compulsory saving scheme for all employees. Normally they can withdraw their pension fund after 55 years old. In Malaysia, we call it EPF (Employee Provident Fund). Pension fund will also use the fund to invest in stock equity and the profit they get will be share to members as a dividend. 

The above are some easy passive income method which require very little amount of money and time. Please start early and enjoy the passive income you earn.