The Best Ways to Earn a Passive Income in Singapore

Passive Income
Earning a passive income is a great way to supplement your paycheck, whether you work full-time or have a part-time job. Passive income can also give you financial freedom when you’re older, allowing you to continue making money well into retirement age. There are many things that you can do to earn a passive paycheck in Singapore, from buying property to investing in one of Singapore’s forty official Real Estate Investment Trusts (REITs). Here are some of the top ways that Singaporeans use to supplement their income each month.
Stock MarketInvest in the Stock Market

Investing in stocks is one of the most common ways people earn a passive income both in Singapore and abroad. While investing itself is relatively simple, it can be difficult to decide where to place your money. It’s crucial that you do your research to figure out which markets are likely to take off in the near future. You may also want to consider hiring an investment advisor if you’re not well versed in finances.

Rent Out Property

Rent Out Property

Earning a passive income by renting out property is another common practice in Singapore. If you own a house or an apartment complex, you can make money each month by renting out the unit. This is not a viable option for everybody, however, as buying a home in Singapore requires a significant initial investment. It can take years for property owners to break even. You also need to consider maintenance costs and other fees.

Purchase Bonds

Purchase Bonds

Bonds are a less risky option than investing when it comes to passive income. Banks, companies, and even governments borrow money that must be repaid over time with interest. Singapore Savings Bonds offer a rate close to 2.5% per annum if you save for the maximum ten years, while the ABF Singapore Bond Index Fund returns close to 2.5% annually. You can also find corporate bonds, but these tend to pose a greater financial risk.

passive income

Peer-To-Peer Lending

While peer-to-peer lending is relatively new, it’s gained booming popularity in a relatively short span of time. With P2P lending platforms, you act as the middleman and join forces with other individuals to bankroll a company and earn interest on loans. While this type of practice can be lucrative, P2P lending is also risky. Typically, it’s used by companies that are unable to land funding from a bank or established financial institution, such as startups and small businesses. You should research any company thoroughly before loaning money through a P2P platform.


Place Money in Annuities

An annuity is a fixed sum that insurance companies pay on a yearly basis after you retire. This is one of the safest ways to earn a passive income; as you’re guaranteed a set amount on a regular basis. It’s a good idea to invest in annuities young so that you’re able to live comfortably later in life.

Earning a passive income can help you to pad your bank account without putting in the effort of a second job. Whether you invest, rent property, or loan out money, you can give your paycheck a healthy boost. There are plenty of avenues that Singapore residents can follow to earn a passive income each month.