Wednesday, September 10, 2008

Passive Income: The Truth

If you have been looking around at work-from-home styled jobs, you have undoubtably seen ads that try to convince you that you can "work from home, making hundreds every day while only working two hours per week!" Once again, we have to ask the question -- is this legitimate?

The truth is, this kind of pitch is an oversell of something that is very plausible. Affiliate websites, using Google Adsense or direct banner ads, can give a very fair amount of revenue. But what can you realistically make off of an AdSense website?

Many "non-experts" find that they can create an affiliate website that generates between $1 and $3 per day. This is, of course, after their website has been found by Google, and is being viewed by a fair amount of people. So, this ranges from $30 per month to $90 per month. And how much work does a website or blog like this take? Well, you should generally post about once per week to keep your ranking up and your followers happy -- so often under 1 hour of real work per week. So, for between 2 and 4 hours of work you can get between $30 and $90. That means you're paying yourself anywhere from $7.50 per hour to $45.00 per hour. Not bad, by any means!

However, I know very few people who can pay the bills off of $90 per month. So there are a few directions to go to increase this amount of revenue. Option 1 -- you can focus on making one or two websites very successful. Option 2 -- you can build a hundred different websites and increase your $90 to $9000 per month. Option 3 -- you can go somewhere in-between, focusing on a few websites (generally under 20) which all receive a higher income than your typical AdSense site.

There are downfalls with each of these methods.

Option 1, it is very difficult to find a single category or subject that will pay you enough to support you off of one website. It's possible -- that's where these people claiming their hundreds of dollars a day are coming from. It is also very difficult to do search engine optimization for a website well enough that you can make this kind of income. Sites like this will take a lot more care and attention, and will have to be a great "discovery" of a niche market that is not yet saturated.

In addition, if Google changes its search parameters and you're pushed down a page, your income may fall through the floor! You are far more susceptible to the whims of the internet, and most of us don't like our income to be based on something that risky.

Option 2 has very different problems. First, you will have to find 100 websites that can generate income. Though you can spout off a lot of gibberish without much effort, it won't make you much money. You have to find profitable keywords. No one is going to pay to have their farm animals sold online, for example, so you probably don't want to blog or make a website about farm animals. So you have to do the research to find 100 different websites. You have to then build 100 websites. Even if these are pre-made blogs, this is going to be difficult to do, and highly time consuming.

Also, to make even the $1 to $5 per blog, you will have to do some basic marketing for the websites, posting your link on directories, forums, etc. So the setup time for Option 2 is pretty massive. To set up 100 effective, money-making blogs, and market them, may well takes months of hard work. If you decide this is what you want to do, don't expect any less than a few hundred hours of work before your website are making you the money you want. In addition, you have to maintain these websites for them to be profitable! Even if you know your subjects, and can post quickly and effectively, you can expect to be working 50 hour work weeks.

Then again -- $9000 a month is nothing to scoff at, and if your objective is earning a lot of money, and you don't mind putting in the effort, this may be a viable solution for you.

Option 3 tends to be the most effective and successful. Setting up a dozen blogs or websites is far easier than setting up a hundred, and your general "labor" after setup will probably be somewhere between 6 and 24 hours per week, meaning that your schedule will be very flexible. However, you should still expect to invest the equivalent of 3-4 full time work weeks to get these blogs/websites up and running.

With effective online marketing and updating, which takes time, patience, study, and experience, you may well see each website generating $5 to $15 per day (this is a reasonable goal -- you will likely be frustrated if you aim too far above this). Just to make the numbers here more clear, with a dozen sites, that may be anywhere from $60 to $180 per day, or between $1800 and $5400 per month. This is the equivalent of somewhere between a $75 per hour to a $900 per hour income, for the time you are actually investing.

Of course, knowing the general outline of making money through blogs, or affiliate marketing websites, is one thing. Knowing the details of how to do is successfully is something entirely different.

For more information on how a coaching company can help you in building your own affiliate website empire, and generate great money online with a reasonable time investment, simply visit

1 comment:

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