Passive Income Streams to Build in 2026

Let’s get one thing out of the way: Building passive income doesn’t mean finding a magic money button or quitting your job next month. If it did, everyone would already be doing it.

What passive income does mean is finding smart, realistic ways to earn extra money over time—without working every night, weekend or holiday just to get ahead. And in 2026, you can find more ways than ever to do that. From using space you already own to creating something once and selling it over and over again, passive income is really about working smarter, not piling more onto your schedule.

This guide breaks down practical passive income streams you can build in 2026. Some options take more effort up front, some take more patience, and none of them are one-size-fits-all. But when you choose the right strategy and build it the right way, passive income can become a steady, helpful part of your long-term financial plan.

What Is Passive Income?

Passive income is money you earn regularly with limited day-to-day effort after an initial setup period. Unlike a second job that trades time for money, passive income includes things like investments, rentals or digital products that can continue generating income over time with less ongoing work.

That said, no passive income stream is completely hands-off. Every option requires some level of effort, risk or maintenance—especially at the beginning.

Passive Income Ideas You Can Build in 2026

If we listed all the ways you can build passive income, you’d be here all day. The possibilities are endless. So instead, we’ve grouped some of the most practical options into a few broad categories to make them easier to understand, compare, and evaluate based on your own situation.

Real Estate and Rental–Based Passive Income

Real estate and rental income can be solid passive income options—but only when you’re out of debt and financially stable. These ideas take more responsibility and upfront effort, but they can provide steady income over time when managed wisely.

1. Buy real estate.

Buying real estate and renting it out is one of the most common ways to build passive income over time. But before you take this step, pay off your own home first and purchase your investment property with cash. Don’t ever go into debt to buy rental property.

Rental properties come in a few different forms. Residential rentals—like single-family homes, duplexes or small apartment buildings—are the most common and usually the easiest place to start. Commercial properties, such as retail spaces, offices, warehouses or storage units, can bring in more rent but often come with more moving parts. Some investors also choose specialty rentals, like vacation properties or mixed-use buildings.

No matter the type, rental income isn’t completely hands-off, especially at the start. You’ll need to find tenants, handle maintenance and take care of occasional repairs. But once those systems are in place—and especially if you keep the property well maintained—the day-to-day effort can be fairly minimal. That’s what makes rental property a more passive income stream over time, not an instant one.

We suggest buying a property somewhere that’s convenient for you to visit so you can personally keep an eye on it. Find a real estate agent who knows your area well and knows what will attract renters.

2. Rent out your house.

If you still have some debt to pay off or can’t afford to take on a whole rental property, consider renting out a spare room. Having a roommate or the occasional Airbnb guest is a great way to sit back and add extra money to your budget—if you don’t mind sacrificing some privacy.

That said, how passive this income feels depends on how you do it. A long-term renter usually requires less day-to-day effort, while short-term rentals like Airbnb can take more hands-on management, especially if you’re hosting frequently. Cleaning, coordinating check-ins, and handling minor repairs all come with the territory.

You also might need to add extra layers of coverage to your existing homeowners insurance policy or get a new type of coverage altogether . . . and that can get really pricey. So talk to your insurance agent before listing your extra room on Airbnb! But with the right setup—and realistic expectations—renting out your home can be a flexible way to earn extra income without taking on a whole new property.

3. Store people’s stuff.

People have a lot of stuff—and they’re always looking for affordable ways to store it. If you have extra space in the basement or the garage, what could be easier than having people pay you to store their stuff? You’ll just need to make sure their items are safe and secure.

Check out websites like Neighbor or StoreAtMyHouse to get started. These are services that can put your indoor or outdoor space to work. Will people pay a ton to have you store their off-season wardrobe? Maybe not—but it can add up over time.

And if you have a barn, garage or even just carport space to store vehicles, boats, campers and other high-dollar toys, people will pay more to keep them safe and weatherproof. Set it (safely) and forget it—talk about passive income!

4. Rent out useful items.

Do you have any items you don’t use all the time that others would like to borrow? Things like a trailer, trampoline, kayak, or even your own yard or backyard pool could earn you passive income as rental items. With rental websites like Hygglo, all you have to do is upload pictures of your items, set a price, and tell the world they’re ready for rent.

If you’re not quite ready to tell the world, consider starting with just your neighborhood. Got a chainsaw, pressure washer or lawn aerator? Larger tools can rent anywhere from $30–70 (or more) for just a half day at retail stores, so there’s a lot of potential cha-ching there.

Hop on your community’s social media sites and start posting, or distribute flyers the old-fashioned way. Hit it during the right season, and your flyers could get a premium spot on your neighbors’ refrigerator doors—and that leads to phone calls.

Before you start renting out tools or equipment, it’s important to think through the details. Setting clear rules helps protect your gear—but it also helps protect you. If someone gets hurt using your item, especially things like power tools or recreational equipment, you could be held responsible. That’s why it’s smart to use written agreements when possible and double-check your insurance coverage before listing anything.

5. Rent out your vehicles.

Have an extra car or truck sitting in your garage? You can list your car on Turo—which lets folks rent out their vehicles to locals or tourists who need a ride for a few days.

And the boat that’s been taking up space in your backyard? Check out Boatsetter to make some extra passive income with your pontoon on a weekend when you won’t be on the water.

But renting out your vehicle to complete strangers could require additional insurance coverages and lots of maintenance costs . . . so consider yourself warned!   

Creative and Digital Passive Income

Creative and digital income streams focus on using your skills or ideas to create something once and earn from it repeatedly. These options usually cost less to start, but they require patience, consistency and realistic expectations.

6. Start a blog or YouTube channel.

If you have a brilliant idea that appeals to a specific audience, you could create something like an educational blog or a YouTube teaching series that doesn’t require constant new material to generate online traffic.

If your content is engaging and gets enough daily traffic, you could sell ad space on your blog or ad spots on your channel. After you put in the heavy lifting, you can sit back, relax, and enjoy streams of passive income for every set of eyeballs that watches your content. Not bad!

Just keep in mind, this is a crowded space. To earn meaningful income, your content has to be genuinely helpful and noticeably different from what’s already out there—and it usually takes time to build enough traffic for the income to add up.

7. Write an e-book or digital guide.

If you’ve figured out how to create content that gets enough traffic to host ads, think about how you can turn that content into a product. It could be anything from a simple e-book or meal-prep guide to a complete online course or an app.

And writers: You can find self-publishing options everywhere like Kindle Direct Publishing (KDP), which has several packages for editing, publishing and even book cover designs. If you have some marketing skills and good pals who’ll spread the word—plus (sorry, but this just needs to be said) if your books are actually a decent read—then go for it! You could still see royalties trickle in years down the road. Yay, passive income!

8. Create an online course.

With learning sites like Udemy, you can use your know-how to create a course on their platform. Once it’s published, it doesn’t require any additional maintenance from you, and you get paid when people take your class. It’s a low-output way of making some extra cash and helping people. That’s like a win-win . . . win.

One member of the Ramsey Baby Steps Community, Courtney, shared that she taught herself how to create an online course on a topic she was already skilled in, and her first course brought in around $1,000 a month. She later created another course to help her family through Baby Step 3—and now that course is helping other people learn how to create courses for passive income too.

Like most passive income streams, creating an online course takes work up front—learning the platform, building the content, and choosing a topic people actually need. But once it’s set up, a course can continue earning over time without starting from scratch each month.

9. Sell stock photos or music.

You could also sell something that taps into your creative skills. For instance, if you’re a good photographer, sell stock photos on sites like Foap or create preset photo-editing filters for people to download. If you dabble in music production, license your tunes and sell them to YouTubers and podcasters to use for their content.

10. Design custom products.

Do you have some artwork that might look awesome on a T-shirt? Or a funny slogan you’d like to slap on a coffee mug? You might want to think about uploading your original designs to print-on-demand websites like Redbubble, Teespring Marketplace and Zazzle.

Most of these services are free to join and make it easy to showcase all your original designs. You still need to promote and advertise your designs, but each time someone orders a shirt, sticker or bucket hat (the ’90s called—they want their fashion trends back) with your design on it, you make money. And the best part is, they’ll handle all the logistics—including the production, storage and shipping of your products—so you don’t have to. It’s that simple!

11. Become an affiliate marketer.

Have you ever bought something really awesome and gushed about it to your friends, family, coworkers and the store cashier? You think to yourself, Man, I should get paid for all this advertising. Well, it’s a thing! And it’s called affiliate marketing.

To put it simply, affiliate marketing is when a company pays you money to publicly brag about their products. If you’re on social media, you’ve probably seen hundreds of people doing this by posting a special link or discount code under a photo of them using a certain product.

Now this doesn’t mean you can just hashtag your favorite running shoes on Instagram and expect to get paid. The companies you know and love have to have an affiliate marketing program for you to get paid for it, and you’d need to apply to become part of it.

Sites like Rakuten LinkShare can help you find and connect with those affiliate marketing programs. Amazon, eBay and Target are just a few of the hundreds of companies that offer affiliate marketing programs.

While you don’t have to be an influencer with thousands of followers to be an affiliate marketer (although that would help you make more money), there are criteria for you to get into the programs. For example, to become a Target affiliate, you have to be a “website owner, blogger or influencer that runs a family-friendly website and has mainly U.S.-based viewership.”¹

12. Advertise on your car.

Getting paid to drive your own car? It doesn’t get any easier than that! If you don’t mind slapping a giant logo on your car (or maybe wrapping the entire car or riding with one of those big cans of soda on the top), sites like Wrapify will set you up to get paid for using your car as a mobile billboard.

Sure, you might lose some cool points for driving a slightly ridiculous-looking vehicle, but you’ll win easy money—without sacrificing time, effort or investment. The average person who does a full wrap on their car makes about $260–450 a month for driving to places they already need to go.² That’s not half bad!

Car-wrapping pro tip: If you live in a subdivision, check to see if it’s okay with your homeowners association (HOA). Getting fined might outweigh the potential profit. Bonkers, but true.

Investment and Savings-Based Passive Income

Investing and savings play different roles at different stages. High-yield savings accounts are great early—for emergency funds and short-term goals—while index funds, REITs and other investments make more sense after you’ve built a solid emergency fund, paid off consumer debt, and are consistently investing for retirement.

In short: Use savings for safety first, then move to long-term investments for growth.

13. Take advantage of high-yield savings accounts. 

Whether you’re trying to build an emergency fund or save for your next vacation, high-yield savings accounts and money market accounts are one of the easiest ways to create a passive income stream and help you reach some of your short-term financial goals.

You can find plenty of online banks and financial institutions out there today offering online savings accounts and money market accounts with annual percentage yields (APYs) between 3–4%. That yield is much higher than the national average for savings accounts, which is only 0.4%.³ (Since online banks and financial institutions have lower overhead costs than typical brick-and-mortar banks, they can offer better rates for their customers.)

Let’s say you have a fully funded emergency fund with $25,000, and that money is in a high-yield savings account with a 4% APY. That account will make $1,000 in interest growth over the next year—and you didn’t have to lift a finger or save an extra penny! And of course, the more you save, the more interest you’ll earn.

14. Invest in low-turnover funds.

When some people hear passive income, they tend to think of investing because it can produce the largest results with the least amount of work. And that’s true! Compared to the other options on this list, investing may be the easiest way to kick back, relax, and earn.

But we want to be clear about one thing: Investing is a long-term strategy—and investing for retirement is way more important than investing for passive income.

That means your first priority is to invest 15% of your gross income for retirement in good growth stock mutual funds through tax-advantaged retirement accounts, like a 401(k) and a Roth IRA. (And don’t even think about touching that money until retirement. If you take money from those accounts before age 59 1/2, you’ll get smacked with early withdrawal penalties.)

Now, once you’re investing 15% for retirement and maxing out all your retirement accounts, then you can start thinking about investing in low-turnover mutual funds. A good way to do that is to invest in an index fund—a type of mutual fund with a low turnover rate—through a taxable brokerage account.

Why a low-turnover fund? Because that means the fund holds on to the stocks for longer so there are less taxes for you to worry about. And why a brokerage account? Those accounts let you access your money at any point without an early withdrawal penalty (and they also have no limits on how much money you can invest per year).

If you’re out of debt and want to start investing, work with an investment professional.

15. Invest in real estate investment trusts (REITs).

What if you’re not interested in being a landlord? There is another way to invest in real estate with something called a real estate investment trust (REIT). A REIT (pronounced reet) is a type of investment that pools your money with other investors’ money to buy properties—it’s basically a mutual fund that buys real estate instead of stocks.

But you should only consider investing in REITs once you’re on Baby Step 7 and maxing out all of your tax-advantaged retirement accounts. And be careful. While there are some good REITs out there, some use debt to purchase properties—which means more risk for you as an investor.

You should always talk with your investment professional before you start investing in REITs—you’ll be glad you did.

How to Choose the Right Passive Income Stream

Like we said, the list of passive income ideas could go on forever. As you search for the best fit for you, you’ll want to ask yourself these questions:

• Do other people make money doing this?
• Which passive income strategy would I be best at?
• Does this idea show a positive long-term track record?
• Has this idea ever come back to bite someone who tried it?
• How much time will this actually take after the initial setup?

Don’t fall for any passive income ideas that promise a quick return or require huge amounts of money up front—like vending machines or opening a laundromat. Things like that require way too much time and money to be considered passive and could ultimately sabotage your financial goals. Look for opportunities that are steady, profitable and trustworthy. Do your research. And never go into debt!

Putting Passive Income in Perspective

Building passive income isn’t about doing everything on this list—it’s about choosing the one or two options that actually fit your life, your finances and your goals. Some streams take more time up front, others take more patience, and all of them work best when you’re building on a solid financial foundation.

The good news? You don’t have to figure it all out at once. Start where you are, stay out of debt, and focus on steady progress instead of quick wins. Over time, the right passive income stream can add margin to your budget, flexibility to your schedule, and confidence to your long-term financial plan.

This article provides general guidelines about investing topics. Your situation may be unique. To discuss a plan for your situation, connect with a SmartVestor Pro. Ramsey Solutions is a paid, non-client promoter of participating Pros.