Dire Straits delivered a mega hit song titled “Money for Nothing” back in the 1980s. Four decades later, can you imagine getting paid more than you usually do without putting extra hours at work? Well, ‘money for nothing’ has a connotation in the financial world, and it’s called passive income. You can use your passive income to repay your credit card outstanding balance and to spend for the next big vacation. If you are eager to know about the best passive income opportunities this year, here are a few smart ideas:

P2P Lending

P2P lending or peer-to-peer lending is the common practice of lending money to businesses and individuals through trusted platforms such as Prosper or Lending Club. By lending money through a platform like this, you can actually earn a higher rate of interest compared to the interest rate offered by your bank. Lending Club, for example, requires lenders to start lending with a minimum amount of $1000. You can diversify your lending and protect your lender portfolio against possible borrower defaults. Fees for these P2P lending platforms are particularly low, and some platforms might offer you interest rates of up to 36%. You see how it is different from your regular savings account? Well, this is just one way to max out your passive income.

Invest In Real Estate Investment Trusts

Real estate investments are known to generate steady returns, but you don’t have to get your hands dirty for investing in that sector. Instead, you can now invest in real estate projects through various crowdfunding platforms online, with RealtyShares being a prime example. The services are top-notch, but you have to get your accreditation as an investor to get started. This makes real estate crowdfunding an impossible dream for most small investors. A feasible alternative is the real estate investment trusts or REITs that have made inroads into the world of real property investing. REITs are similar to mutual funds, and you can start trading like stocks. Some of the REITs are also listed on major stock exchanges. Fundrise is one such REIT platform which requires its investors to start with a capital of $500 only. Rich Uncles is another such platform which allows investors to invest in single-family real properties.

Make The Most Of Your 401 (K)

Your employer’s contribution to your retirement savings plan is free money which can make a huge difference when you finally retire from your day job. Imagine if your employer contributes about $500 every year; in 30 years, that contribution would add up to more $33,000, taking your own contributions into account. There are certain apps on the marketplace to help you out to make the most of your 401 (K). Blooom is one example of a 401K optimizer app which helps you grow your additional retirement savings.

Opt For Micro Investing

Hundreds of micro-savings apps are readily available on the internet, and you can easily use these apps to grow your passive income. Stash is one such app which facilitates users to transfer small amounts from your savings. Acorns is another useful tool which helps you pull together your purchases made with a credit card to the nearest whole number, and the difference is added to your investment portfolio. Therefore, if you bought a cup of coffee for $3.40, the app will round it up to $4, and the 60 cents would be added to your investment portfolio.

Invest In Certificate Of Deposit

If you are eager to secure your money, check out if your bank offers certificates of deposit or CD. You can invest in savings accounts that offer a fixed interest over a set period of time, and these accounts are fully insured by Federal Deposit Insurance Corporation. If your money is put down in a Certificate of Deposit, you cannot withdraw the amount before the maturity date. But CDs usually generate more interest than the regular savings accounts.

You can ensure a decent passive income for yourself if you apply the above-mentioned ideas well. For investing in these areas, you don’t have to be an investment expert. You don’t have to work extra hours at your office or pick up a second job. Instead, you can just become a savvy investor and follow the tips to generate a decent income. Good luck!