The concept of passive income has changed a great deal because of the Internet. In the past, passive income usually described income earned from real estate. Limited partnerships were also a possible source of passive money, but for the most part, real estate was king. Money earned as a wage or through direct effort was known as active income, and money earned through investments was known as portfolio income.

Passive Income Today

Today, the term passive income is often used to describe money earned by affiliates. Affiliates are key to the success of many online businesses. Through technology such as cookies, affiliates can earn money over and over simply by adding links to their own websites. Add the link once, and the money can roll in for years to come.

The goal of this type of income is usually financial or personal independence. Many people stumble into this work while stuck at home, raising kids or caring for ailing parents. Those who have a knack for the affiliate partnerships or programs they choose can eventually make quite a lot of money.

Beware of affiliate programs that require start up costs. Although some legitimate programs do require some initial money, many do not. You certainly don't want to cough up thousands of dollars for a ridiculous get rich quick scheme. I suggest only affiliating yourself with those businesses that want you to do so for free.