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How to earn passive income in Singapore: 8 ideas for different personalities
Who doesn’t want to make more money by earning passive income in Singapore? Imagine watching extra cash flow in, month after month, without having to lift a finger!
However, there’s no one-size-fits-all way to generate passive income. We are all different; one person’s idea of “passive” is not going to be another’s cup of tea.
The key is to play to our strengths, whatever they are. Here are 8 diverse passive income ideas in Singapore for different personalities. Find the one that fits you best.
#1 Invest in high-dividend stocks
#2 Be a lazy landlord with REITs
#3 Robo-advisors or ETFs
#4 Buy bonds like the Singapore Savings Bond
#5 Sell stock photos, videos, or music online
#6 Create content on YouTube
#7 Share your expertise
#8 Rent out a spare room
Suitable for: Financially-minded types who have an appetite for stock-picking.
Let’s start with an obvious way to get some extra money: investing in high-dividend stocks on the Singapore stock exchange.
You basically buy a small slice of a big company, and a little bit of its earnings gets paid out in the form of dividends a few times a year.
Investing in stocks does take a bit of capital and effort, though. You’ll need to set up an investment brokerage account first. Ideally, you’d want to buy stocks with at least $5,000 to $10,000 to start with, because brokerages usually charge a minimum commission fee.
Since there are tons and tons of stocks to choose from, you’ll also need to do quite a bit of research. The ability to decode annual reports is a big plus as well. Depending on how much you like researching, this can either be fun or decidedly not-passive.
Once the groundwork is done, though, you can hang on to your stocks forever and just earn dividends from them.
Suitable for: Those who believe fervently in real estate.
Want to be a landlord without having to fork out a million bucks for an investment property? The passive way to do this is with a real estate investment trust, or REIT, which is a subset of stocks.
Similar to how stocks make you part-owner of companies, REITs let you be part-landlord for properties, such as shopping malls and office buildings. Then, sit back and collect the “rent” in the form of dividends.
REITs are very popular in Singapore because they are legally required to re-distribute their earnings, meaning investors can collect high dividends passively.
To invest in REITs, you’ll also need a brokerage account and (ideally) $5,000 or more to start. There are fewer REITs than company stocks in Singapore, so it is relatively easier to pick what to invest in.
If you do not have thousands of dollars upfront, certain robo-advisors specialise in Singapore REITs with low or no minimum investment.
Suitable for: Truly lazy investors, or people who suffer from analysis paralysis.
Don’t feel you personally are up to scratch when it comes to buying stocks? Then leave it to the experts (or an algorithm) by investing in index-tracking exchange-traded funds (ETFs).
ETFs are “fun packs” of stocks packaged to track a certain benchmark, such as the Straits Times Index, which compiles the 30 top-performing Singapore stocks.
The appealing thing about ETFs is that, if company X flounders and falls off the index, the ETF will automatically adjust. So it’s very passive as far as investments go. Also, putting your eggs in so many baskets reduces the risks of investing.
You can buy ETFs on any stock market with an investment brokerage. Another great way to invest in ETFs is with a robo-advisor. Most robo-advisors focus on ETFs, and have low or no minimum investments.
Suitable for: Conservative types with low risk appetite.
Did you know that when you invest in a bond, you’re actually lending money to whoever issued the bond?
That means when you invest in a Singapore Savings Bond, you’re lending to the Singapore government.
High-grade government or quasi-government bonds, like SSBs or Temasek bonds, are considered low-risk alternatives to stocks.
The interest rate and repayment schedule is agreed upon from the start, and these are credible borrowers with very low risk of defaulting on their loans.
The bond issuer pays you interest every 6 months or so, which results in passive income for you. At the end of the bond, or whenever you decide to withdraw, you can collect your capital.
Bond interest rates are currently low. However, since there’s no lock-in, you can buy SSBs now (with as little as $500), then sell and repurchase if the rates increase in the future.
Suitable for: Artistic, creative types.
Many Singaporeans have gone through a shutterbug phase at some point. If you have terabytes of high-resolution holiday photos from back then, don’t delete them! Try selling them to stock photo websites first.
You can even dust off your DSLR and make money from your photography hobby. Authentic stock photos with natural-looking models are always in demand, as are specialised niche subjects and photos depicting new trends.
It’s not exactly “passive”, but if you make extra money by pursuing your hobby, it won’t feel like work either. Plus, the content stays on the platform for a long time after you have finished creating it and as people download or watch them, you get income!
If you are a videographer or music creator, the same advice applies. Go ahead and sell your drone shots of Singapore as B-roll stock footage, or license your tracks to stock music agencies. A quick Google search will show you the top stock website for each media format.
Suitable for: Those who are not camera shy.
If you are a regular social media junkie who’s always hamming it up for the camera, a great way to generate passive income is by hosting your own shows on YouTube.
They don’t need to be intensively edited either. There are tons of low-effort video ideas like mukbang videos, “study with me” sessions, narrating stories, guided meditations, make-up tutorials, or even uploading videos of your pets.
YouTube makes money by advertising, so if you turn on ads on your videos, you get paid a small amount for every view. The more views your video has, the more money you can make.
This can be passive income in the sense that your video can continue earning money for months or years after you put it up.
Suitable for: Subject matter experts who are keen to share knowledge.
If you are a subject matter expert of some sort, don’t keep your musings to yourself. Consider publishing them on Medium and Substack.
Both are paid (written) content platforms that pay when users view and love your content. This works particularly well if you can write interestingly and engagingly about your area of expertise/interest.
If you are willing to put in effort to make an educational video, you can put it up on online learning platform Skillshare. Subscribers pay to learn, and you get paid for every minute they watch.
Suitable for: Anyone with room to spare.
Finally, here’s a tried-and-tested way for Singaporeans to earn more money with minimal hassle: renting out a spare room.
All it takes is an extra room and a few minutes to post it on Carousell or 99.co. Some have even found tenants at their workplace. You will need to draft an agreement when you find a suitable tenant, but once you do, then the monthly rent is yours to keep.
However, not everyone likes to share their home with others. If that’s the case, you may consider a less invasive way to generate passive income, like renting out storage space. You can check the market rates for that on Carousell.
Another option is to rent out your room for pet boarding! Of course, taking care of pets is far from “passive” — but if you love animals anyway, why not? You may list these services on a pet marketplace like Pawshake or advertise directly on pet interest groups.
As you can see, passive income isn’t really free income. You still need to put in some effort at the beginning to get things going. But after that, you can see the income trickling in long after you have put in the investment or uploaded a piece of content on a paid platform. It’s not impossible to find one that suits your personality and financial situation to supplement your main income. Good luck!