Not all lawyers are top earners, but they have the potential to earn more through passive income. According to ZipRecruiter, lawyers in the United States earn an average yearly income of $80,743. Whether you’re experienced or just recently graduated and want to earn extra cash, read on for ideas.
This article takes a deep dive into ideas that can generate passive income for lawyers. It also explains what passive income is and what types of passive income exist. If you are willing to put in the time and effort, you can pursue any of the passive income streams included in this guide.
What Is Passive Income?
Passive income is the ability to earn money with little to no participation. It is a hands-off approach to earning money that can be fixed or progressive. Passive income is considered fixed when it is a one-time earning deal and progressive when it is ongoing or lasts for an extended period of time. As a lawyer, having a steady cash flow from passive income can help offset your slower months.
Passive Income Strategies for Lawyers: Types of Passive Income
As a lawyer, there are several approaches to making passive income in addition to the active income you get from your career in law. Some of the most common passive activities and strategies are financial investments, rental income, and affiliate marketing.
With the right financial management skills, you can earn monthly to yearly dividends on your capital. Lawyers can earn passive income by investing cash in stocks, mutual funds, bonds, or futures contracts. These financial assets need very little active participation and can be liquidated at any time. You might want to seek help from financial advisors on the best financial investments.
This is one of the most popular passive income strategies in the United States. You can generate rental income by purchasing a real estate property and leasing it. It is also possible to generate rental income on properties that you do not own if you have the right lease agreement. You just need to find a real estate investment model that works for you.
Affiliate marketing can pass as active or passive income, depending on the route you choose to take. In any case, it involves promoting the goods and services that belong to another person or business. Affiliate marketers typically get a commission for each successful conversion that stems from affiliate links.
10 Best Passive Income Ideas for Lawyers
Earning a passive income as a side hustle could potentially bring you freedom through entrepreneurship. You are essentially a business owner making alternative investments to earn additional income. Earning extra money outside of your regular job may require a mindset shift. Below are some passive income ideas for lawyers to consider.
1. Write a Law Book
As a lawyer, you have first-hand insight into law and can take advantage of that by writing a book. These days, you can make an extra income from a book outside of publishing companies. You can sell your book on Amazon, AbeBooks.com, eBay, and BookScouter.
2. Real Estate Investing
If you have a good credit score, you can work as a real estate professional to earn money. There are options that don’t need a hands-on approach. These include rental properties, real estate investment trusts, real estate investment groups, house flipping, and online real estate platforms. You can also take real estate courses.
3. Invest in Mutual Funds
A mutual fund combines funds from a few investors. They then invest this money in stocks and bonds. Investors buy shares in the fund, which means that each investor is a part-owner of the fund portfolio. The income that is generated from the portfolio is shared amongst each investor.
In the US, the most common types of mutual funds are money market funds, bond funds, and private equity funds.
4. Start a Legal Blogging
Create a passive income blog with high-quality content. Blogging requires some attention as you would need to update it regularly to grow your audience. With the right audience, you can eventually monetize your blog and only update it a few times a week. Blogging also helps you generate leads to build your client base.
5. Start a Legal Vlog
These days, video blogs tend to get more engagement than written blogs. You can make videos providing free legal tips on platforms that pay creators. Tiktok and YouTube are currently taking the lead and are great platforms for building a client base. Popular creators with a large audience benefit from company endorsements that are trying to reach a larger audience.
Podcasting is another way to earn an additional income and educate people at the same time. You have expertise that others don’t have and would benefit from. A podcast is an audio series that is streamed digitally. The more listeners you get, the higher your earning potential.
7. Lend Dormant Cash
Use saved money in your bank account by lending it out with interest through peer-to-peer lending. Although it can be an effective strategy, it comes with major risks. There are several P2P lending platforms that allow you to lend money to others securely and get paid with interest. These include LendingClub, Fundly, and Upstart.
8. Rent Out Your Car
Your car could help you earn extra cash if you rented it out during office hours. This is another passive activity income with low participation. Make sure that you rent your car through a reliable platform like Turo to minimize the risks of losing your car. Turo has been around for the past 11 years and has gained a dependable reputation.
9. Sell an Online Course
Write short law courses with educational content and sell them online to make money. The only time you will spend on this project is the time required to write the course. Skillshare, Podia, Thinkific, Udemy, and Teachable are some great places to sell online courses for passive income.
10. Join Affiliate Marketing
You do not need to write a book or sell your own products and services for affiliate marketing. All you need to do is promote the products or services of another business, using affiliate links. This will earn you a commission when a sale is made. You don’t have to restrict yourself to law in the affiliate niche. Affiliate marketers make an average of $154,700 per year, according to ZipRecruiter. This is much higher than what layers make on average.
Other Ways to Make Extra Money as a Lawyer
- Ridesharing. If you do not like the idea of renting out your car, you can sign up as a driver on a ride-sharing app. Rideshare side gigs with companies like Uber and Lyft are among the top side hustles that pay well. You have full control over the hours so it won’t interfere with your full-time job.
- Online tutoring. You can tutor high school students and college students online. You’ll find tutoring gigs on platforms like Studypool, TutorMe, and Tutor.com. Choose from a broad range of topics that are available on these platforms.
- Freelance writing. You could start part-time freelance writing to earn extra cash when you are not working. Find freelance writing jobs on sites like Upwork, Toptal, and FlexJobs.
- Thesis writing. Thesis writing is a type of freelance writing that has to do with creating projects for graduate students. It usually requires quite a bit of time but you have the option to work around your schedule, especially when you work online. Thesis writers usually get paid significantly more than other freelance writers.
- Sell anything you aren’t using. You do not need any professional qualification or fancy business model to sell things you are no longer using. You can use platforms like Craigslist, Facebook Marketplace, or OfferUp.
How to Make Passive Income for Lawyers
There are many opportunities for lawyers to make passive income online or offline. You can blog, make videos, or look for alternative investments like real estate or mutual funds, especially if you need additional sources of income that don’t require too much of your time.
Passive Income for Lawyers FAQ
Some of the most popular myths around money are based on the belief that you need a college degree to earn a comfortable income. Other myths revolve around the idea that nine-to-five jobs are the only stable route to financial prosperity.
One of the most reliable ways to make a million dollars in passive income is to invest in high-end real estate assets. This is a capital-intensive form of passive income so you will need large amounts of money. However, it can guarantee six figures or more annually if you follow the right business plan.
Lawyers can make extra money by getting into the online legal marketplace and providing services remotely to clients who are interested in legal matters. Some great online platforms for lawyers to make extra money are LawTrades, UpCounsel, and Hire an Esquire. You can also join Montage Legal Group and FlexLegal.
The safest investments with good returns are treasury bonds, money market accounts, and treasury inflation-protected securities. Other safe investments include corporate bonds, high-yield savings accounts, and S&P 500 Funds. Weigh the risk and reward before investing in any financial market.
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