Ever wish you had a little extra money each month? You’re not alone. It’s why many people are looking for flexible ways to earn without being tied to a desk or required to work a second job.

That’s where passive income comes in. Passive income simply means earning money without having to work for it every day. It usually involves an initial setup cost, like making an online shopfront, renting out something you already own, or investing.

In this guide, we’ll cover what passive income is and we’ll share 15 ideas to get started earning a passive income in Australia. Plus, we’ll go over a few things you need to know before you get started.

Passive income is money that comes in regularly without needing you to show up and work for it every time. It could be in the form of something you’ve built once, like an online course, or from something you own, such as an investment or a rental property.

Unlike a regular job, you’re not trading time for money. Instead, you’re earning passively (hence the name) from the time, money, or effort you put in upfront. Once it’s set up, it can run quietly in the background and give you more freedom and flexibility.

More Australians are finding clever ways to make an extra income without stacking on more hours. From the classic tried-and-true investments to modern digital ideas, here are 15 of the most popular passive income streams in 2025.

What we’ll cover:

• ETFs (Exchange-Traded Funds)
• Selling digital products
• Rental property income
• Self-paced online courses
• REITs (Real Estate Investment Trusts)
• Peer-to-peer lending
• High-interest savings accounts
• Car or caravan rental
• eBook or guide royalties
• Dividend-paying shares
• Print-on-demand merch
• Affiliate marketing
• Stock photography or video licensing
• YouTube ad revenue
• Licensing music, templates, or tools

Don’t want the pressure of picking out individual stocks? No worries. ETFs bundle together a bunch of companies so you can invest in a whole market or industry at once. Many pay regular dividends and will tick along happily in the background.

First step: Compare ETFs by reviewing their management fees, past performance, and payout frequency.

Make it once, sell it forever. Whether it’s a budgeting spreadsheet, a work template, or social media graphics, digital products can keep earning without you lifting a finger after they’re live.

Start with an industry you already know. For example, if you work in sales, create a visually stunning sales pipeline template.

First step: Validate your first design by checking what’s already selling on places like Etsy.

This is an old-school favourite, and for good reason. Renting out property can give you a consistent income, especially if the rent covers your mortgage and then some. You may even be able to use the equity in your home to buy a property to rent out.

First step: Check what places are renting out for in different suburbs. Look for areas where lots of people want to live, but not many rentals are available.

Did you know that you can turn what you know into income? Package up your skills into a course people can take any time, like a social media marketing mini-class or basic coding boot camp. Once it’s live, it can run on autopilot.

First step: Pick a topic and write out some lesson ideas to lead your students towards a specific outcome. Keep your first course short and targeted so you can launch fast.

If you like the idea of rental income but can’t afford to buy a house or don’t want to deal with property management, REITs are a great option. They let you invest in big property portfolios, which could include office buildings, shopping centres or warehouses, and earn a share of the rental income, without any of the hands-on work.

First step: Research how different types of REITs perform (commercial, retail, industrial) and check how often they distribute income.

Lending money isn’t just for the banks anymore. Peer-to-peer lending lets you loan money to individuals or small businesses and earn interest as they pay it back. It’s far riskier than a savings account, but – because of this – the returns can be higher.

First step: Research how peer-to-peer lending works, including what kind of returns you can expect and how likely borrowers are to default.

This may not be the most exciting option, but it can add up. With rates higher than they’ve been in years, the right savings account can quietly earn you extra cash in the background without any effort.

First step: Check what your current account’s interest rate is. If it’s low, look for one with better returns.

Let your vehicle earn when you’re not using it. Some platforms let you rent out your car or campervan on your days off. It’s one of the simplest ways to turn something you already own into passive income.

First step: Make sure your insurance covers vehicle sharing or rental.

Write it once, earn for years. Short, helpful eBooks or guides (covering topics like marketing or budgeting) can be sold over and over again.

First step: Outline a problem you already know how to solve. Ideally, it would be something in a space you already work in.

Ready to put your savings to work? Investing is one thing, but having investments in companies that pay generous dividends means you’ll see some of your money before you sell your investment. Once you’ve invested, you can start receiving payments without lifting a finger.

First step: Learn how dividend stocks work and explore how to invest through a share trading platform.

If you’re a designer wanting to sell merch, you might not want to turn your living room into a screen printing warehouse. The great news is that you don’t have to. Instead, you can work with a third-party printer and distributor. All you’ll need to do is upload your designs once (for T-shirts, tote bags, mugs, etc.), and they handle the rest.

First step: Create a few simple designs and begin to test them on a print-on-demand platform.

Get paid to recommend stuff you already use. If you’ve got a blog, newsletter or Instagram page with a following (even if it’s not huge), you can earn a commission when people buy through your links.

First step: Sign up for a few affiliate programs that match what you usually share online. Infuse the products into what you already share, but ensure you disclose them by adding “#ad”.

If you’re a good photographer, your photos could be making money right now. Upload them to stock platforms and earn royalties whenever someone uses them in ads, websites, or social media.

First step: Curate a small batch of high-quality images. Try to get images like popular Australian travel spots or modern office shots. These are the kinds of photos tourism boards and businesses are always searching for.

Make high-quality content once and keep earning from views. If you post helpful, evergreen videos (like tutorials or how-tos), they can keep bringing in ad revenue long after they go live.

First step: Pick a question people are searching for online and film a basic explainer video. Check Google's “People also search for” in the search results to see what questions people are looking for the answers to.

You don’t have to be famous to earn royalties. Designers, musicians, and coders can license their work (like soundtracks, design templates or Figma plugins) and get paid every time someone uses them.

First step: Choose something you’ve already made that others might find useful and search for platforms that allow you to sell your work for royalties.

Not all passive income ideas are created equal. Some need time, others a lot of money upfront, and a few need both. Before you dive in, here are a few things to keep in mind.

• Time vs. money: Some ideas cost more upfront, others take time to build. Consider how much you are willing to part with to get your idea off the ground.
• Risk tolerance: Can you handle ups and downs? Some income streams (like investing or lending) carry more risk than others.
• Diversify: Don’t put all your eggs in one basket. Spreading your investment across a couple of ideas can help you stay more stable if one stream dries up.
• Think long-term: Most passive income options take a while to start providing. Give it time to grow rather than expecting instant results.

Most types of passive income are taxable, so it’s worth knowing what your obligations are before you begin to invest your time and money. Here’s the basics of what you need to know.

• Most income is taxed: Rent, interest, dividends, and royalties all need to be reported on your tax return.
• Capital Gains Tax (CGT): If you sell an asset (like shares or property) for a profit, you’ll likely owe CGT.
• Franking credits: Some dividends come with tax credits attached, which can reduce how much tax you owe.
• Deductions: You can often claim costs related to earning passive income, like management fees or software.
• PAYG instalments: If your passive income is high enough, the ATO may ask you to pay tax in advance.
• Get advice: A registered tax agent can help you make sure everything’s above board and you don’t run into problems in the future.

Building passive income means doing the work once, then letting it earn in the background. Whether it’s investing, selling digital products, or renting something out, the goal is to set it up and let it grow over time.

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