A cheap small business idea can be the ideal way to make passive income.

Passive income is money earned separately from your main job, usually with little effort required. As the cost of living increases, finding a side hustle to earn passive income can be a great way to boost your finances.

Take a look at these 15 passive income ideas to see if there’s one that aligns with your skills and interests. 

1. Dropshipping

November dropshipping

Dropshipping is a popular way to make a passive income, especially if you only have a small budget to get you started.

Dropshipping allows you to set up an online store and sell products without needing to invest in inventory. Instead, each time a customer makes a purchase your dropshipping provider will ship the item.

Your chosen dropshipping provider handles everything, from processing the order to shipping the goods and dealing with returns. 

Dropshipping is a cheap and easy way to sell products online without needing to invest a huge amount of time and money, just be sure to select a reliable supplier to avoid issues.

  • Resources required: You’ll need to set up a website or online store to sell your products and will need to source a reliable dropshipping supplier too. 
  • Skills/qualifications needed: None
  • Cost: £0 – technically you can set up your dropshipping store for free and won’t need to pay a penny until someone makes a purchase.

Check out our expert guides on dropshipping:

2. Print-on-demand

Print-on-demand can be a great passive income idea for those with creative talent but who don’t want to start a printing franchise.

If you’re an artist then a print-on-demand business allows you to print designs onto white label products such as mugs or tote bags. 

Like with dropshipping, you only print each item once an order has been placed and you usually do so via a print-on-demand supplier. This helps to keep costs to a minimum. 

You only pay for print-on-demand products once you’ve made a sale. If you enjoy getting creative then print-on-demand could be the perfect passive income choice.

  • Resources required: You’ll need to set up a website or online store to sell your items and find a reliable print-on-demand supplier.
  • Skills/qualifications: Artistic skills will be a plus but not an essential.
  • Cost:  £0 – technically you can set up your print-on-demand store for free and won’t need to pay a penny until someone makes a purchase.

3. Spare room rentals 

We all know that renting out property can be lucrative but we don’t all have the savings to invest in purchasing a property.

If you have a spare room in your home, renting it out either as a long-term rental or as a holiday let can earn you a considerable amount of passive income.

Depending on your situation you can rent out your spare room privately or via a third party such as Airbnb (although be warned, you may need to pay tax).

Be sure to check any agreements you may have with your own landlord first and consider adding an application process to be sure you’re comfortable with whoever takes the room.

You wouldn’t be the only one considering this option either, data from SpareRoom shows an 89% increase in the number of homeowners renting out a spare room between 2021 and 2024.

  • Resources required: A spare room that you’re willing to rent out to a stranger.
  • Skills/qualifications: None
  • Cost: The only expense will be investing in landlord insurance which starts at as little as £3 per month.

4. Car parking rentals

It’s not just the inside of your home you can rent out. If you have off-road parking then why not rent out your parking space?

People are always looking for cheap parking and if you live in a desirable location or nearby key attractions (e.g. football stadiums, arenas etc) then renting out your space can be lucrative.

There are plenty of third-party apps you can use to promote your space such as YourParkingSpace. You’ll just need to set your price and your terms and conditions. 

  • Resources required: Off-road parking/a parking space to rent out.
  • Skills/qualifications: None
  • Cost: The only expense will be investing in insurance which starts at as little as £3 per month.

5. Shopping rewards

Fancy earning money whilst you shop? You can thanks to cashback sites that allow you to earn back money each time you make a purchase.

This is a great passive income source providing you would be shopping in the first place, don’t be tempted to overspend or make unnecessary purchases just to try and increase your rewards. 

  • Resources required: Nothing other than a bank account and internet connection.
  • Skills/qualifications: None
  • Cost: Technically £0 however you will need to spend money to make the purchases in order to earn rewards.

6. Stock photos

If you’re a photographer then you may be used to being paid for the time and effort you put into photo shoots.

While this isn’t a passive income source, there is a way to make passive income through your skills with a camera that doesn’t involve starting a full-time photography business: stock photos. 

You can sell your photo portfolio to stock photography websites (or start your own) and depending on the site and their terms and conditions, either get paid every time your image is downloaded or in one lump sum. 

There are already millions of stock photographs online, however, so you’ll need to ensure yours stand out from the crowd to break through an already saturated market.

  • Resources required: A quality camera.
  • Skills/qualifications: Photography skills.
  • Cost: £0 once you’ve invested in a camera.

7. Online courses

If you have a skill that you think you can teach others then why not create an online course?

It’s never been a better time for educators to get online and sell digital courses to students. Online learning is the fastest growing education market and it’s predicted that the number of people taking online courses will rise to 57 million by 2027. 

You will need to invest initial time and effort into creating the course, pre-recording lessons, and creating resources and worksheets but the good thing is this will all sit online meaning you don’t need to house physical items. If you build a website with Squarespace, you can even use the specialist Squarespace Courses platform.

Another option is to start a podcast. Some of the best online tutors now teach their students via audio so they can fit lessons easily into their day.

Ideally, you will also automate your marketing and sales funnel to make this a truly passive income source.

  • Resources required: You’ll need to set up a website for your online course and create the full course content, often including videos and worksheets.
  • Skills/qualifications: You’ll need skills and qualifications in your chosen course topic.
  • Cost: £0 – you can absolutely set up an online course for free, but it will require a considerable time investment to get started.

Speaking of starting up…

You’re here because you’re thinking of starting a business, right? Why not get insider advice straight from the horse’s mouth? Our podcast, Speaking of Startups, features warts-and-all fails and inspiring tales from successful founders. Listen along to learn about what to do get started and succeed.

8. Storage 

Another passive income idea is to offer up space to store items for other people.

If you have extensive storage space, such as a large garage or basement that sits empty then why not offer up the space at a cost?

People are always looking for paid storage, whether it’s to house seasonal decorations, a place to keep their belongings between house moves or to keep valuables safe whilst they go travelling, the audience potential is vast.

Consider using a third-party platform such as Stashbee to help you find customers and avoid any liabilities. 

  • Resources required: Empty storage space such as a loft or basement.
  • Skills/qualifications: None
  • Cost: You’ll need special contents insurance which starts at as little as £4 per month.

9. Social media adverts

Running social media adverts can be a great side hustle and can be pretty lucrative!

You’ll first need to build up an engaged audience on your platform of choice, such as Instagram or TikTok. To do this be sure to choose a niche that you enjoy for example comic books, decor, cooking, sailing etc.

Once you’ve built up an engaged following you’ll be able to approach brands about working with you. If they like your personal brand then they will pay you to promote their brand and products online to your audience.

Whilst being a social media marketing is a great side hustle, you will need to dedicate time to growing your audience before you can begin making any money.

  • Resources required: Social media accounts that have grown an engaged audience. 
  • Skills/qualifications: None but creativity and a knowledge of digital marketing would be ideal.
  • Cost: £0

10. Digital products

Whether it’s a web design template or an ebook, creating and selling digital products on a platform like Amazon can be a great passive income idea.

You do have to front-load a lot of the work, as you’ll need to put the time and effort into creating the actual product first, but once done you can list it online, set up a digital marketing strategy, and wait for the orders to roll in.

Profit margins are high for digital products as you only have to make the product once and there’s no limit on how many you can sell. There’s also no need to cover costs for inventory storage and shipping either.

  • Resources required: You’ll need to create the product, such as writing an ebook or designing web templates. 
  • Skills/qualifications: The skills you need will depend on the product you want to sell, for example if you want to write an ebook you’ll need writing skills and knowledge on your topic of choice.
  • Cost: £0 however you will need to invest time to create the original product.

11. Affiliate marketing

Affiliate marketing is a great way to make passive income.

Affiliate working works by recommending a product or service to an audience. Every time a user purchases by clicking on your link to the item, you’ll earn a commission.

If you already have a blog or an engaged audience on social media then affiliate marketing is the obvious next step and you can make money by sharing affiliate links to relevant items.

There are various affiliate programs you can join, such as Amazon Associates, and affiliate marketing is low-risk thanks to the fact you don’t need to invest an initial budget to get started.

It’s also scalable as you can keep introducing new products to your audience while your previous links stay active and can keep generating revenue.

Beware the ‘Side Hustle Tax’:

Remember! You may need to pay tax on your passive income. Check out our guide to side hustle tax to ensure you’re fully compliant.

  • Resources required: An affiliate website or social media account with an engaged audience.
  • Skills/qualifications: None
  • Cost: £0

12. Start a YouTube channel

If you think you could create interesting videos on a certain topic, such as cooking, fitness or makeup then why not start a YouTube channel?

YouTube has on average 122 million users per day, that’s a lot of potential viewers for your channel!

Admittedly, getting started on YouTube takes time, you’ll need to grow your audience not to mention film, edit and upload your videos.

Once you’ve started growing an audience and video catalogue however you can monetise your channel, making money from YouTube Adsense every time users watch your videos. Shopify users can do this easily, thanks to Shopify’s partnership with YouTube. 

  • Resources required: A camera to create videos.
  • Skills/qualifications: None but video editing would be a plus.
  • Cost: £0 once you’ve invested in a camera/filming equipment.

13. Investments

You don’t need to be an angel investor to back a startup. In fact, it can be a great way to bring in passive income, after all, once you’ve made your initial investment you don’t really have to do anything else!

Thanks to third-party platforms you can now invest a small amount in startups, reducing the risk and need for a large budget.

The returns will depend on the success of the business of course, and before making any investment decisions you should research thoroughly. We can’t give you financial advice so be sure to speak to an expert who can.

  • Resources required: Intel on where and how you want to invest.
  • Skills/qualifications: Money management and financial planning skills.
  • Cost: The cost would be totally dependent on how much you are willing to invest.

14. Buy a website

If you don’t want to spend time building up your business idea then why not purchase one that’s ready-made?

Business websites are put up for sale all the time and most will come with content, an engaged audience and a high domain authority which can considerably bring down costs.

If you go down this route opt for one that is already bringing in money via affiliate links and opt for a niche that you feel comfortable creating content for in the future.

When purchasing the website carefully evaluate the earning potential and how much passive income you think it will generate before you put in your offer.

  • Resources required: None
  • Skills/qualifications: None
  • Cost: Websites can start at around £100 and raise to thousands of pounds depending on their niche, content and audience.

15. Sell crafts

If you’re skilled at crafting, whether it’s knitting, painting or origami, why not sell your creations online by starting a craft business?

People are increasingly looking for independent and unique businesses to shop with meaning now is a great time to sell your wares. In fact, 69% of consumers would rather shop with a small business than a larger alternative. 

Selling crafts is a perfect way to target some of those customers. You could also teach crafts by turning your hobby into an online course (more on this above).

Of course, there is an initial investment for materials as well as the time you’ll need to commit to making your items, but if you’re already a crafter in your spare time this is a great way of turning a hobby into an income stream.

The best way to sell your handmade items online is via marketplaces such as Etsy or on your own website.

  • Resources required: Craft equipment and materials.
  • Skills/qualifications: Artistic skills in your chosen craft such as knitting or crochet.
  • Cost: You’ll need to invest around £50 in materials to get started.

Final Thoughts

If you’re looking to make passive income then finding the right idea is essential. You must choose the one that best aligns with your existing skill set and budget.

Some passive income ideas require an initial financial investment, as well as considerable time and resources. Once set up though, they can top up your finances for years.

No matter which one you choose, having a passive income source can be a sensible and exciting choice to make money in 2025, without having to start a business.

Lucy Nixon – content writer

With 10 years experience in the digital marketing industry, Lucy is a content writer specialising in ecommerce, website building and all things small business. Her passion is breaking down tricky topics into digestible and engaging content for readers. She’s also committed to uncovering the best platforms, tools, and strategies, researching meticulously to providing hand-on tips and advice.



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