How to Generate Passive Income with Just $20
Discover six ways to generate passive income with just $20. From fractional stock and real estate investing to selling website domains and print-on-demand T-shirts, these strategies can help you build a steady income stream with minimal upfront investment.
In today’s economy, $20 may not seem like much, but it can be the starting point for building a passive income stream. Passive income strategies allow you to earn money without active, ongoing work. While some initial effort is required, these methods can become “set it and forget it” investments.
Here are six innovative ways to generate passive income with just $20.
Table of Contents
1. Fractional Stock Investing
Fractional stock investing is a great way to start earning passive income with a small amount of money. Todd Stearn, founder and CEO of The Money Manual, recommends researching stocks and investing in small amounts through an online or app-based brokerage.
“Look for brokerages that allow fractional investing, meaning you can buy partial shares rather than full shares,” Stearn advises. “Ensure they don’t charge fees such as low balance fees, transaction fees, or commission fees, as many brokerages have eliminated these.”
2. Fractional Real Estate Investing
Another option is fractional real estate investing. Apps like Fundrise allow you to invest in fractional shares of real estate with a minimum investment of as low as $10.
“These companies typically charge a small percentage of your investment for management, often between 0.15% and 1.85%,” says Stearn. Alternatively, you can invest in real estate loans through platforms like Groundfloor with a minimum investment of $10. “Groundfloor charges no fees to investors, and most loans are repaid within six to nine months with an average payout of around 10%,” Stearn explains.
3. Selling Website Domains
Jason Lamprey, owner of Lamprey Construction, suggests investing in industry-specific website domains with potential resale value.
“Platforms like GoDaddy or Namecheap offer domains at low prices, sometimes starting as low as $0.99 for the first year,” he notes. “Use your initial $20 to secure a few niche-specific domain names, preferably in industries you understand well.”
Lamprey recommends listing these domains for sale on platforms like Flippa or Sedo to reach potential buyers. “Focus on trending industry keywords to buy domains that could attract business owners and entrepreneurs,” he adds.
4. Earning Interest and Bank Account Bonuses
Finn Wheatley, a financial expert at The Small Business Blog, suggests using online savings accounts to earn interest with a small deposit. “Places like Ally let you earn more on your savings without a big deposit,” he says.
Additionally, look for banks offering bonuses for opening new accounts. For example, Truist Bank offers a $400 bonus for opening a Truist One Checking account and meeting certain requirements, such as receiving a direct deposit of at least $500 and completing 15 debit card purchases within the first 90 days.
5. Starting a Membership Website
Creating a membership website is another viable option. “With $20, you can set up a website where people pay monthly fees to access information or join an online community,” Wheatley suggests.
Start by testing out content to attract your first members. Even a few people paying $5-$10 monthly can generate a steady stream of passive income over time.
6. Selling Print-On-Demand T-Shirts
Selling custom T-shirts online through print-on-demand services is another low-cost passive income idea. “Sites like Printful allow you to design shirts and list them online,” Wheatley explains. “They handle the production and shipping as orders come in, so you can earn passive income while you sleep.”
Conclusion
Generating passive income with just $20 is entirely possible with the right strategy. Whether it’s through fractional stock or real estate investing, selling website domains, earning bank bonuses, starting a membership website, or selling print-on-demand T-shirts, these methods can help you start building a steady income stream with minimal upfront investment.
