How can small investors start passive income? An in-depth breakdown of the top 10 money-making methods

Who Says Passive Income Is a Patent of the Wealthy?

When it comes to “money making money,” many people think it’s a game only the rich can play. In reality, whether you’re a white-collar worker, a small investor, or a student, as long as you find the right methods, you have the chance to build your own income system. But before taking action, you need to understand one thing: passive income is not about lying around doing nothing to earn money. It requires initial investment, mid-term maintenance, and only then can you reap the later rewards.

The Essence of Passive Income: A Swap of Time and Money

Passive income simply means money that flows continuously without daily effort. Its key advantage is that even if you change jobs or resign, this income will still keep flowing into your pocket. But don’t be fooled by the word “passive”—the initial stage requires time for planning, capital investment, or professional knowledge, and only afterward can you enjoy the returns.

Many people misunderstand passive income as “guaranteed investment.” In fact, besides traditional tools like bank fixed deposits, most passive income methods carry risks, such as financial products potentially losing value, rented items being damaged, or e-commerce projects facing sluggish sales. So the first golden rule is: Never treat passive income as your main livelihood; active income (salary) is the foundation of your economy.

The Panorama of Passive Income for Small Investors: Choose According to Risk Level

Low-Risk Steady Approach

Bank Fixed Deposits — The simplest starting point

If you already have idle funds, depositing them into a bank fixed account is a no-barrier way to start. For example, in Taiwan, a 2-3 year fixed deposit rate of 1.625%, a capital of 4 million NT$ can generate over 5,000 NT$ in interest per month. Although the amount isn’t large, it requires no maintenance effort. For students and workers, even smaller amounts are worth trying—it’s an excellent way to cultivate the mindset of “making money work for you.”

Buying Financial Products — An advanced choice

If the returns from fixed deposits are too low, consider stocks, funds, or bonds. These three tools carry increasing risks but also higher potential returns. For employees and small investors, ETFs (Exchange-Traded Funds) are a balanced option—no need to pick stocks yourself, just track the market index. For example, tracking the US S&P 500 index with SPY, or Taiwan’s weighted index with 0050, are popular choices.

Bonds are more stable but require careful selection due to default risks. Money market funds are between the two, with lower risk but limited yields.

Medium-Risk Flexible Approach

Regularly clearing out unused items at home — Turning waste into wealth

When tidying closets, old appliances, books, or gaming peripherals, consider listing unused items on second-hand platforms or flea markets. While single sales may be limited, accumulating over time can add up, and the process also helps free up living space. Items for sale range widely—from small appliances to phones, old clothes, or pet supplies—if in good condition, there’s a market.

Creating and selling online courses — Monetizing knowledge

If you’re skilled in a certain area (photography, programming, languages, design software, etc.), you can produce systematic instructional videos and sell them on online platforms. The advantage is that once recorded, they can be sold repeatedly, saving time on repeated explanations. Compared to offline tutoring, this method better fits the “passive” definition.

Renting out infrequently used expensive items — Activating assets

Cameras, lenses, designer bags, luxury cars—if you own these high-value idle items, you can rent them out via professional rental platforms. These platforms usually have damage compensation clauses, offering more security than personal rentals. The specific income depends on the item type and rental frequency.

Pet sitting for others — Turning hobbies into income

More young people are owning pets, and when they travel for work, they need someone to care for their animals. If your community has neighbors with pets, you can charge for walking dogs, feeding, or playing with them. The fees are usually comparable to pet shops, but many owners prefer to entrust their pets to familiar people. Promote your services via community bulletin boards or pet enthusiast groups.

High-Risk High-Reward Approach

Collecting limited edition merchandise — Turning interests into investments

For anime, gaming, or movie fans, buying limited edition figures, models, and collectibles has potential for appreciation. Some genuine limited items can increase in value several times on auction markets. But the premise is that you understand how to “snatch deals” and grasp market trends, which requires time and insight.

Becoming a landlord and collecting rent — The highest investment level

Purchasing property and renting it out is a dream for many passive income seekers. But note: Only when rental income covers the mortgage and still leaves a surplus is the property truly an asset. Otherwise, it’s just a liability with a loan. Before investing, carefully calculate your monthly cash flow—don’t let passive income turn into passive losses.

Starting an online dropshipping store — Light-asset entrepreneurship

Opening a store on Amazon, eBay, or similar platforms, working with factories on a “drop shipping” model—customers place orders, and you coordinate with suppliers to ship directly, without holding inventory. Profits depend on product selection; everyday items with thin margins (storage bags, health kettles, office supplies) are common. This requires initial platform setup and customer service, but once established, it can greatly save time.

Cloud mining — In the crypto asset domain

Participating in cryptocurrency mining via mining pools (like F2Pool, Poolin, AntPool, etc.). This is a high-risk, high-professionalism field, not suitable for beginners unfamiliar with crypto assets.

How Should Small Investors Choose? Quick Benchmark Table

Three Major Pitfalls of Passive Income

Trap 1: Expectting 100% Capital Preservation

Financial products, real estate, collectibles—all carry risks. Funds and stocks may lose value, tenants may default or damage property, collectibles may depreciate. Even bonds have issuer default risks. Only bank fixed deposits are close to risk-free options.

Trap 2: Over-relying on Passive Income

Until passive income can cover your living expenses, it’s just a supplement to your regular salary. Employees, small investors, and students should regard stable jobs as the economic pillar. Passive income is a long-term accumulation bonus.

Trap 3: Seeking Quick Gains and Giving Up

Initial passive income streams are often small and seem insignificant, which can be discouraging. But think long-term: if students earn NT$20,000 annually from passive income, in 4-5 years, that adds up to NT$100,000—enough to buy a decent laptop or invest in the next project. Keep a long-term perspective to realize the power of compound interest.

Take Action: Your First Suitable Step

No matter what your current identity is, you can find a suitable entry point into passive income. Students can start with fixed deposits or clearing items; employees can try financial products and renting out idle items; small investors have enough capital to experiment with multiple options.

Remember this principle: Any method that generates income legally, stably, and without taking up too much time is a good method. Don’t let the word “passive” limit your thinking—what matters is to start acting, keep optimizing, and be patient with compounding. Five or ten years later, you’ll thank yourself for the decisions you make now.