Passive Income – Can I get rich from it?

Passive income is a type of income that is earned without the need for constant or active effort. For designers it means creating a digital and asset and selling it over and over again. Examples are journal templates on Etsy, books on Amazon, stickers on Redbubble or fabric on Spoonflower. 

Why would you bother?

1. Freedom and Flexibility

Passive income allows you to earn money without the need for continued work, which means you can have more freedom and flexibility in your life. You can work on other projects or hobbies without the need to constantly focus on earning income.

For young families this can be great for when you have to take time off from standard work hours due to a sick child or other commitments. It also means your still earning money while your holidaying! 

2. Earning Potential

With passive income, there is the potential to earn higher income over time as your assets grow and generate more income. The longer you produce passive income assets the bigger your shop can be and the more customers you can attract. This is particularly effective if you cover a few different niches and genres.  This can lead to financial security and independence.

It allows you to spread out your income streams as well. Having multiple streams trickling into your bank account means that if one stream stops flowing either temporarily or permanently then you have other steams still providing you income. This is especially true when some income steams become bloated with new designers. 

3. Portfolio Building

When making assets for passive income streams, you often start with your own personal preferences which means you make your best work! As time goes by you tend to stretch and grow, adding new techniques and styles to your repertoire. This can show how flexible and creative you can be and show more advanced skills for future clients who want to book you for custom work. 

Drawbacks of Passive Income

1. Initial Investment

Setting up the accounts and assets for passive income can be a huge time sink. And you might not make any money back on that investment. In fact most people don’t for quite some time! Listing products for passive sales is a risk, it might not pay off, and you have to accept that at the start. 

Creating assets for passive sale also takes a lot of time. You can offset some of this by recycling things you may have made for other projects that were not successful, or even reworking some of the work you did for education or design challenges. 

2. It’s Personal

When you succeed it feels great, when you don’t it hurts. It can take some time to build a successful passive income stream. Potential customers rely on intuition and research when buying products so having one thing on Etsy with no reviews is not going to go anywhere. You need to be able to put your pride on hold and keep making even with no sales to eventually maybe hit the bucket of gold. Passive income streams are a risk and they don’t always pay off.

I made a bug pattern for a Spoonflower challenge, I really thought I nailed it, I then spent hours and HOURS making matching patterns and clip art files and put it all up on etsy. Then the results for the design challenge came in and I was in the 1400s. It hurt, I was thinking “why am I doing this, I obviously suck.” But 2 weeks later and I’ve got my big girl panties on and I’m trying again, and meanwhile the Bugs and Blooms assets are still on Etsy and Spoonflower, one day they might sell, if not they at least make my shop look more populated. 

3. Small Gains

Passive incomes is small gains, very small gains. It is making $3 on a clipart package on Etsy, $3 on an Amazon Journal,  $2 on a metre of fabric on Spoonflower or 50cents on a sticker on Redbubble. Tiny gains. But you also are not doing any of the work. You are not printing the product, reprinting if there is an error, you’re not packaging it up and heading to the post office. You are literally sending a file and then handing off the rest of the work to someone else.

Often designers take it personally that the gains are so small and the business who is producing the work gets paid so much. But you really have to get over it. And be grateful for a service that is available to you at no cost, something that could be filling gaps in your income or adding to it.

The benefits of small gains dos not become apparent until you’re earning a lot of them, and that does take time. Give it time before you give up. 

Conclusion

Passive income can be a great way to diversify your income streams and achieve financial independence, but it’s important to understand the benefits and drawbacks of this type of income. If you’re interested in generating passive income, do your research, identify the assets that align with your goals, and be prepared to invest significant time and effort to set them up. With dedication, hard work and enough time to take off, you can build a reliable passive income stream that provides financial security and flexibility.

My best suggestion is to start an excel sheet early on, and record your monthly sale and followers. I also record any new releases so that I can see patterns and try and replicate this patterns. Also sign up for every social media! Facebook, Instagram, TikTok, Pinterest and link them up so they post to each other. Exposure if what is going to help you to grow a following and get your sales happening. Social media builds trust and can show people who they are buying from. Humans want to support humans, so show your humanity.