8 strategies for earning a passive income as an expat

What if you could make money in your sleep? Would you quit the day job? Reduce your hours at work? Take on an assistant to help you manage your day? Upgrade your home?

There are lots of reasons why an expat may want to look for passive income sources, and though most require upfront investment or a significant amount of time, the long-term benefits are always worthwhile, giving you peace of mind and flexibility as you get older.

Below, we’ve rounded up eight passive income strategies to employ as an expat…

Cashback credit cards

Let’s start with an entry-level passive income source. Around the world, banks and lenders offer credit cards that provide cashback incentives that range from 0.5% to 5%. If you’re already going to be shopping for new furniture or a flight back to the UK, it makes sense to spend on a rewards card. This passive income may only equate to a couple of dollars here and there, but it adds up once you start using the card regularly. Just remember to pay your bill in full every month to avoid interest, and shop around for the best rewards and perks.

Invest in property

Although investment in property isn’t entirely passive (you’ll always have some level of involvement, even if you hand over the reins to a lettings agent), the buy-to-let market is a lucrative option if you’re looking to diversify your income streams. Once you’ve purchased a property and rented it out, there’s very little work involved and you can enjoy a monthly guaranteed income, as well as capital growth should you decide to offload in the future.

If you want to be hands-off, consider a lettings agent or property management company to work on your behalf. They’ll charge anywhere from 5-15% of the monthly rent, but mean that you don’t have to deal with problem tenants. The best part about investing in real estate is that your tenants pay your mortgage for you, and once it’s paid off, your cash flow will increase significantly, making your retirement more comfortable in the decades ahead.

Become a silent partner

If you’re a successful entrepreneur and want to get your finger in a pie in your new country of residence, consider becoming a silent partner. If you’ve spotted a business in your niche that needs an angel investor to provide some capital for their growth, introduce yourself and see what happens. Rather than offering a loan, you can take an equity share of the business and reap the rewards as the organisation increases in value and profitability.

Refer expat friends and contacts

If you’re an expat looking for another passive income source, consider referring friends, family, and contacts who move to the country. Speak to small business owners that you’ve worked with - it could be removals firms, decorators, translators - and offer to recommend clients in exchange for a cash bonus. Everyone from landscape gardeners to electricians will be happy to take on clients through referrals and give you a small kickback. If you are a prominent figure within your expat community, you can easily make additional revenue from your recommendations; anywhere from $50 to $500 per month is a reasonable figure.

Rent out your spare bedroom

Airbnb and other lettings apps have exploded in popularity in recent years, with travellers and professionals using the platforms to find affordable accommodation in towns and cities around the world. Consider renting out part of your property to guests to earn extra money from your home - if you live in a desirable part of town, it’s easy to use Airbnb to pay off your mortgage early. Bear in mind that you’ll need to clean and service the room between each guest, and you’ll need to be respectful of their privacy. No late-night parties, either!

Build an expat course

As we’ve already touched upon, some passive income streams require upfront investment: this is one of them. As an expat, the chances are that you’ve learned a lot about your new life abroad. Translating that expertise into an online course (for example, “My Five-Step Programme for Moving to Dubai on a Budget”) could be a way to drive additional revenue. 

Websites like Udemy allow you to put your content in front of potential students, and the best part is, other than marketing, once you’ve written or recorded your course material, you can forget about it. Students will come to your page, pay for access, and perhaps buy other products you offer, whether that’s ebooks, one-on-one training, or workshops. Be sure to market your courses on forums, social media, and through SEO to maximise sales.

Invest in index funds

Investing in the stock market might sound overwhelming without prior experience, but it’s possible to get involved passively. Index funds allow you to invest money in the general market, without you having to choose specific investments or rebalancing your portfolio. The idea is that you hand over the responsibility to a larger investment group who will work on your behalf. The best part is that you can choose the type of investment - whether that be banking, energy, technology, and so on - and leave the experts to work their magic. As with all stocks and shares, your capital is at risk, so only work with experienced players.

Start blogging and use affiliate marketing

Finally, consider launching your own expat blog and adding affiliate links to relevant brands and businesses. Every time someone clicks on a link on your blog or YouTube video and makes a purchase, you’ll receive a commission. Unfortunately, affiliate marketing takes time, and you can’t expect to start earning thousands of pounds overnight, but if you already have an active and engaged audience, it’s possible to leverage this to your advantage and earn. 

Although there are no get-rich-quick schemes here, these passive income techniques should give you some food for thought and help you reshape your finances. Employ one or two of these and you could free up more time to enjoy your expat life, wherever you are.

Be sure to join in the conversation in our community and check back to Money Saving Expat soon for more advice on living your best expat life - and saving money in the process.