Some of the best ways to earn passive income in small towns include providing local lead generation services, creating an online course, Airbnb hosting, operating vending machines, and renting out your vehicle.
Of course, there are many valid reasons why some people choose to stay in their respective hometowns - such as family or current employment. The good news is that it’s possible to increase earnings using these ideas - without needing to relocate.
Local lead generation, for example, allows you to offer businesses a valuable service that helps them gain organic traffic and leads. This ultimately translates to greater income for them - and also for you. We offer a coaching program for anyone interested in learning about the required SEO skills to make a living by building your own lead generation business.
Top 5 best ways to earn passive income in small towns
1. Providing local lead generation services
Whether you’re from a small town or a big city, you can start your own lead generation company. You can offer your services to small local businesses that want to boost their online presence and gain more traffic.
Lead generation is definitely our #1 recommendation. I’ve been working in the industry since 2014 and now I’m earning a monthly income of up to $60,000 with lead generation. Clients happily pay me as I help their businesses get organic search engine leads. It may initially require hard work, but once you do this right, your client’s business website can stay on top rankings for years. This can mean a steady stream of income for you, so it’s really a great passive income strategy.
Pros
Lead generation is a profitable industry. Currently, the lead generation market in the US is expected to hit $3.2 billion this year. Businesses are willing to pay top dollar as you bring them leads from search engine traffic. This is because a bigger number of organic traffic translates to better leads and sales for them.
Ranking a website locally is easier. With local lead generation, you’re not competing against thousands of websites from all over the world. Instead, you’re focused on ranking geographic-specific keywords for your clients - which brings faster results. You’re only competing with at least 20 or so businesses in a given town.
You’re in full control of your digital properties. With the rank and rent model, you build your own keyword-focused websites, rank them on Google, and then offer the leads to small businesses belonging in the same niche. If a business stops paying, you can instead offer your websites and their leads to competing companies.
Retaining your ranking requires very little effort. Once the site makes it to top search engine results, you won’t have to do much to stay there. Ranking can stay there for years with minimal work. Your clients get unlimited free traffic and you can continually earn passive income for renting your digital properties.
You can expand to other small towns (and big cities) without moving. For example, even if you live in a small California town, you can own and manage digital real estate in Detroit, Milwaukee, New York, and others.
Cons
You’ll initially have to pay for everything. Before you can start earning, you will need to cover the costs of building and ranking your sites. You’ll have to spend around $500 to create a site. Of course, it’s a worthwhile investment since it can yield an 85% to 90% profit margin, amounting to $500 to $2,000 per month.
Finding interested business owners can be challenging at first. Some business owners may hesitate to hire your services if you’re new in the industry. This can be overcome, however, as long as you can you can deliver leads to the businesses. As you come in and build that traffic up, you prove that you can generate traffic faster and easier than digital marketing agencies.
It can be time-consuming. Local lead generation takes time and patience, especially with certain keywords. It’s always best to focus your efforts on profitable niches if you’re hoping to rank fast. That’s why prior research is important. Also, you can outsource the writing of the service sites.
Lead generation requires expertise. You’ll have to learn and understand SEO techniques to generate leads effectively. Of course, it takes time to gain these skills, so the higher barrier to entry helps this market stay less saturated. Again, our comprehensive lead gen coaching program can help those interested to learn.
2. Creating an online course
Creating and selling your own online course can also be a great way to make passive income. When done right, you can make $1,000 to $10,000 per month as a course creator. Some popular platforms where you can sell and promote your courses include:
Pros
You can work on your course during your free time. It’s possible to create your course in your spare time and you can do it from your home. You won’t even need an office to get working - just a laptop and your ideas.
Creating a course won’t cost much. To a large extent, you’ll only have to invest time on course creation. Other than that, you may only have to spend on software or hire a professional (such as a graphic artist to help you with design).
An excellent source of extra money. Once your course is online, you can make some cash even during your sleep from each sale.
You can reach a wider audience. With an online course, you can target a global market. You’re not limited by your geographic location, which means you can sell your course to local and international learners.
You won't have to teach the course every time. An online course can be a form of leveraged income, which means you you can sell the course without having to teach it every single time someone takes it. You have leveraged that content for income without using more of your time.
Cons
Marketing your course requires hard work. While it’s possible to earn passive income from your course, you can’t just sit and wait for the money to come in. You will definitely need to work hard to stand out. There can be hundreds of similar courses in the market so you'll need to promote your course often. For example, you can use social media strategically to attract traffic and sell your course.
You’ll probably have to spend on advertising. Other than using free resources on social media, spending on advertising is also ideal to spread the word about your course to your target market.
Competition can be tough. There are a lot of online courses out there. Reaching your target market can be a challenge, especially if you’re not someone with an established following.
Some people may not be interested in your course. There’s always the possibility that you will invest a lot of time creating a course that may not be interesting enough for others. To avoid this, you’d want to do extensive research (such as conducting polls) to gauge which topics are best for your audience.
3. Airbnb hosting
You can earn anywhere around $1,000 to $3,000 a month by being an Airbnb host. You can list your home, private room, small apartment, cabin, treehouse, or any type of property with the platform.
With Airbnb, you are in control of how often you plan to accept guests and how much you charge. Their official website also mentions that some of your responsibilities as a host are to clean the place, respond to guest inquiries, and provide basic amenities (such as towels and toiletries). Other Airbnb hosts even go the extra mile by offering bottled water, coffee machine, extra blankets, pillows, and more.
Meanwhile, the platform offers one-on-one Superhost guidance, specialized support, guest identity verification, reservation screening, damage protection, and liability insurance for their hosts.
In addition, listing your home on Airbnb is a practical way to make passive income while traveling.
Pros
Bigger earning than long-term rentals. You can make more money listing with Airbnb than renting out your property to long-term tenants. Furthermore, you can increase your rates during peak seasons. As more and more tourists, vacationers, and digital nomads are picking Airbnb properties over expensive hotel rooms, you get more opportunities to earn - especially if your house is in a high demand location.
You are in full control of your schedule. You decide when you want to accept guests on your property, whether it’s once a month, a few nights per week, or more. If you need to use your house or you’ll be too busy to monitor, you can take temporary breaks from hosting guests.
You can be hands-on or hands-off in your approach . As a host, you can choose how you interact with your people who book your place. According to Airbnb, “some hosts prefer to message guests only at key moments—like sending a short note when they check in—while others also enjoy meeting their guests in person.”
Insurance for property owners. Airbnb protects property owners through AirCover for Hosts. This includes $3M Host damage protection, $1M Host liability insurance, and $1M Experiences liability insurance.
Attracting tourists in your small town - or nearby areas. With an Airbnb property, you can break into your small town's tourism economy. Even if your town isn't popular or tourism friendly, you can market the Airbnb for nearby attractions. To illustrate, Williams AZ is a small town near the Grand Canyon. Also, Munds Park is between Sedona AZ and Flagstaff AZ. There's definitely plenty of opportunities for you to earn from a small town Airbnb.
Cons
Income can be unpredictable. Unlike renting out to a tenant where you earn a fixed monthly amount, income may vary and can be seasonal when you’re an Airbnb host. You really can’t expect a consistent income. It all depends on how many guests book your place. Also, you’ll have to share your earnings with Airbnb by paying service fees.
It can require a lot of time and patience. Case in point, you often have to stay online often so you can respond to inquiries and reviews. Sometimes, you may also have to drop by in person to attend to your guests' concerns. At times, you may even encounter irresponsible guests who may damage your furniture or are extremely noisy.
The continuous cleanup. As a host, it’s your responsibility to keep your space tidy in between guest stays. This includes cleaning, sanitizing, and resetting the bedroom, bathroom, kitchen, and everything else. You can do the tasks yourself or hire professional cleaning services.
The negative reviews. Even if you work hard to please your guests, getting bad reviews can be inevitable. These can take away future business opportunities for you. It’s always a good idea to respond to negative feedback to show them (and other readers) that you’re willing to improve. As for retaliatory reviews, you can actually file a dispute with Airbnb to have them removed. Be ready to present evidence if the guests have committed serious policy violations.
Compared with Airbnbs in bigger towns and cities, you won't earn as much. You can't expect to earn the same income as Airbnbs located in bigger areas. Of course, it's also possible to manage an Airbnb remotely if you're from a different area.
4. Operating vending machines
According to Globe News Wire, the worldwide vending machine operators market is expected to grow from $37.99 billion in 2022 to $42.36 billion this year.
Operating a vending machine can be an excellent source of passive income, especially if you place it in a high foot traffic location. You can sell snacks (chocolate bars, cookies, potato chips), beverages (canned soda, juice drinks), and other items (tobacco products, electronics, tissue paper).
Of course, there are some considerations to keep in mind if you're operating a vending machine from a small town. For example you can approach gas station owners if you want to place your vending machine with them. Another idea would be to target local factories where you can sell your products to their workers.
Just be ready to spend $3,000 to $7,000 on a brand new vending machine - or as much as $10,000 to $38,000 for those with advanced features. Alternatively, you can also consider purchasing a used vending machine. If you want to start vending machine business, check iKrave Vending.
Pros
Low risk and easy to operate. A vending machine is usually a low-risk business model, especially if you start with a single machine. Also, running a vending machine business is relatively simple. Unlike running a physical store that requires your daily presence, you only need to check and replenish your stocks regularly. You also don’t have to invest a lot of time to keep earning.
You can set your own hours. As a vending machine owner, you are your own boss. You can enjoy flexibility in your schedule and make money while you’re at home - or even on vacation.
Steady income stream - and your earnings are in cash. Depending on your preference, you can collect your money on a daily or weekly basis. This provides you with a regular source of income. In addition, operating a vending machine means you get to collect your earnings in cash (unless you own cashless vending machines that accept electronic payments).
You can control your growth. As you eventually learn more about your market and the business model itself, you can decide to have more machines in more locations around your town. In addition to gas stations and factories, other profitable small town locations include apartments, gyms, hospitals, hotels, retail stores, and schools, among others.
Cons
You’ll have to compete for location. Competition can be stiff for prime locations. Sometimes high-traffic areas are already occupied by other vending machine owners. This may force you to sell other unavailable items or to switch to another area.
You may have to share your income. Some leasing agreements with location owners require vending machine operators to pay a percentage of their sale. Generally, you'll have to pay around 10% to 25% off your vending machine revenue.
Carrying and counting coins can be tedious. If you own a coin-operated vending machine, you’ll have to carry heavy bags of coins around each time you do the rounds. That also means you’ll have to count everything before you can deposit your money in the bank.
You’ll have to spend on repairs. As mentioned, you won’t always be around to watch over your machines. And since they’re in public locations, wrong usage may lead to broken machines. This can be a challenge, especially if there are little or no repair services for vending machines in your town To avoid (or at least reduce) this problem, you can learn to do basic fixes for common vending machine problems. Additionally, take note that vending machines are often a target of thieves and vandals. So it’s also important to pick a safe area for your business.
5. Renting out your car
If you have a spare car sitting in your garage, you can make extra money by renting it out. Tourists and gig drivers often rent local vehicles, and they can be among your target customers.
You can sign up with car sharing services such as:
Pros
You can generate extra income. According to Get Around, a car owner can earn as much as $694 to $1,425 each month. That figure can increase if you’re renting out 2 or more vehicles at the same time.
Renters are pre-screened. You get to have peace of mind because car sharing companies often conduct background and DMV checks before allowing anyone to drive your vehicle.
You still have insurance coverage. When you rent out your car, your personal insurance provider won’t be paying for any damages caused by accidents. Not to worry because car sharing companies often have insurance coverage (and roadside assistance) for car owners that use their services. Check and compare insurance plans before listing your vehicle with any platform.
Regular driving keeps your car in good shape. Renting out your car is better than leaving it undriven for too long - which can lead to maintenance issues. Some of these common problems include “dead batteries; rusted brakes; dried-out and leaking seals; and insect or rodent infestation,” points out Consumer Reports.
Cons
Cleaning the vehicle is your responsibility. Renting out your car means you’ll have to clean it often, especially in between rentals. This can be a time-consuming task since some drivers and passengers can be messy.
Maintenance costs can be expensive. Of course, you also need to spend on maintenance. The wear and tear of daily use can decrease your car’s value. Moreover, you need to keep your vehicle well-maintained if you want to meet inspection guidelines and stay in the car sharing program.
Your car can get stolen. While rental companies pre-screen renters, there isn’t any assurance that your vehicle won’t get stolen. You’ll always have to deal with that possibility when other people drive your car.
Your car won’t be available during emergencies. As mentioned earlier, it’s recommended that you use a spare vehicle for car sharing. Besides, it won’t be available for you to use during emergencies. It’s always better if you have your own car (or a backup) available for such cases.
Of course, another side hustle idea is to rent out your private vehicle to advertisers. With this, you will be wrapping your car with ads and potentially earn anywhere from $175 to $1,500 per month. To get started, check with the companies like Carvertise, Nickelytics, and Wrapify.
What is passive income?
Passive income is defined as the extra money you earn from other sources aside from regular employment. Although it initially requires investment and effort, passive income is revenue you automatically make without actively working for it. They can be an excellent way to supplement the salary you regularly receive from your day job.
According to Britannica, some examples of passive income sources include “rental income, interest income, investment income, and affiliate marketing.” As mentioned earlier, other possible sources are local lead generation, online course royalties, vending machine operation, and more.
These low-effort side hustles can definitely boost your income stream without requiring much of your time and money - as long as you’ve already laid out the initial work and investment.
What are other ways to make money in small towns?
Here are 20 other ways to make money in small towns:
These jobs, businesses, and side hustles can help you earn extra cash without having to leave your area.
1. Affiliate marketing
With affiliate marketing, you will function as an affiliate partner for different brands. You receive a commission every time a customer clicks your affiliate link and purchases something from the company.
As long as you have an active blog or YouTube channel, you can make money from this even if you’re living in a small town. To learn more about how to get started, read our complete 7-step guide on affiliate marketing.2. Annuity
Annuity can be structured in different ways and they can grant you a steady income stream. Usually, you’ll have to pay annuity to a financial institution (such as an insurance company) through a lump sum or a series of payments. You can then receive a monthly payout in the future.
3. Auto detailing
To get started with auto detailing, you’ll need to invest on equipment like an air blow out gun, extractor, rotary buffer, steam pressure washer, vacuum, and more.
Typically, detailing a car takes at least 2 hours and costs anywhere from $15 to $125, depending on the level of service you provide. You can make an income of as much as $4,000 each month as you accommodate more clients in your area.
4. Blogging
Blogging can be a profitable venture for writers living in small towns. To build your audience, pick a niche you’re passionate about and consistently produce content to capture readers’ attention.
Aside from affiliate marketing, you can also generate income from Google ads, merch sales, subscriptions, and sponsored posts.
5. Creating apps
Experts expect that the app development sector will grow by $218.90 billion in 2027. If you have the technical know-how or can hire a programmer, you can bring your app ideas to life and then sell them via the App Store and/or Google Play Store. If your apps are interesting enough, people and companies will gladly pay for them.
Case in point, Brooklyn-based software Josh Wardle’s hit Wordle game was purchased by New York Times for an unrevealed price in “the low seven figures.”
6. Cryptocurrency
Investing in cryptocurrency can likewise improve your personal finance. While there are risks involved, the rewards can be hefty, too. The good thing about cryptocurrency is that there are many online communities that can help you learn valuable information along the way. Moreover, you don't have to rely on traditional banks and you’re not dragged down by inflation. Also, the blockchain technology for digital currencies is secure.
7. Equipment rental business
To avoid buying equipment they’d only use for a while, people are always willing to rent from equipment rental businesses. For example, you can rent out your boat, camera equipment, drones, fishing gear, inflatable bounce house, musical instruments, portable hot tubs, and more.
8. Franchising
As opposed to starting a new business from scratch, franchising allows you to purchase a recognizable brand name with an established system. You have higher chances of succeeding in your small town because most potential customers will be familiar with the brand.
Also, franchisors provide franchisees with training and ongoing support to ensure the business runs smoothly from the get-go. Just be ready to pay for upfront investment costs such as franchise fees, royalty fees, and others.
9. Having a garage sale
Another side hustle idea is to sell unnecessary items in your garage. You can offer secondhand items to interested local buyers. For example, you can sell your books, clothes, furniture, kitchen appliances, musical instruments, sports equipment, toys, and others.
When holding a garage sale, the best days are Friday, Saturday, and/or Sunday. Also, it’s ideal to schedule it on or after paydays to make sure people have money to spend. Make large signs to attract the attention of neighbors and passersby.
10. Laundromat business
Laundromats can also be a hit business idea, especially if there are limited competitors in your town. Besides washers and dryers, you’ll also need folding tables, laundry carts, and laundry soap vending machines.
11. Parking lot business
Vacant space owners can make passive income by having a parking lot business. This can be a worthwhile business venture, especially if you’re near commercial areas such as airports, event places, schools, and shopping centers. Once you have the space ready, market your services to potential customers in your town. Next, hire an attendant who will monitor the parking lot and collect fees from vehicle owners.
12. Peer-to-peer lending
Considered by many as an alternative financing source, peer-to-peer lending is usually for people who can’t borrow money from traditional lenders. Usually, P2P interest rates are lesser than bank rates. As a lender, you can gain a high return on investment because the middlemen are removed from the equation.
13. Podcasting
With over 464 million listeners across the world today, podcasting is a growing industry that has plenty of opportunities for talented podcasters. In a way, podcasts are like blogs but are in audio format. With the right equipment, you can record and upload episodes from your bedroom. As with blogging, having a large fanbase can work for your advantage.
14. Real estate investing
A huge upfront investment is often required when you’re working in the real estate industry. Still, it’s an income source that can help you build long-term wealth if done well. If you’re located in Cape May, New Jersey, for example, you can acquire and rent out a house or apartment to earn monthly rental income.
15. Selling digital products
Selling digital products can be an excellent passive income idea for creative types. As mentioned earlier, one example of this is to create an online course. Other top-selling digital products include:
Intangible goods allow you to target a larger market since you can sell them to both local and international buyers. Also, digital products require lower overhead costs and never go out of stock. They’re easier to manage than products with physical inventory. Moreover, they bring higher profit margins if you pick the right niche.
16. Shopify dropshipping
With the dropshipping model, you can run an e-commerce store without the worries of storing and shipping products. Instead, you only forward purchases to Shopify and then they do the rest of the work. It can be a low-cost and low-risk way of starting a new business.
17. Starting a cleaning business
Meanwhile, a cleaning business can be a great idea for those who want to earn active income. There’s always high demand for cleaning services so you can definitely make good money as you target clients in your town.
You can start a residential cleaning company if you want to focus on serving local homeowners. In this small business model, you will need to follow specific cleaning instructions from your customers. Also, you will need to take note of room arrangements and put everything back in order after you’re done cleaning.
For commercial cleaning, your usual clients will be business offices, event centers, hospitals, hotels, schools, shops, and others. Usually, you’ll have to follow strict cleaning standards and use specialized equipment for this.
18. Uber Eats delivery
Another popular income-generating hustle is to work for Uber Eats delivery. This can be done full-time or part-time, depending on your availability. Small town residents love the convenience of ordering food so you’ll have plenty of potential customers in this line of work.
19. Working as a virtual assistant
Even if you’re from a small town, you can work as a virtual assistant and target nationwide and international clients. You can provide different administrative services such as answering emails, article writing, doing market research, scheduling meetings, and others.
20. YouTube automation
YouTube automation can be an excellent business idea for those who want to make money online. This works by managing a channel with the goal of producing video content that helps you generate passive income.
What sets YouTube automation apart from regular YouTube channels is that you don’t have to appear on your videos. You’ll mostly have to focus on running the channel and then outsource everything else - from scriptwriting and video editing.
To monetize your channel, you’ll need to have 1,000 subscribers and 4,000 watch hours. When done right, you can earn as much as $1,000 to 10,000 on your YouTube channel.
Can you rely on passive income?
While it can provide you with a safety net, you can’t entirely rely on passive income alone - unless you already have multiple sources of income, both active and passive. Ideally, the goal is to identify the most effective passive income opportunity that works for you - and then work toward adding more income streams over time until you achieve greater financial independence.
Book author and businessman T. Harv Eker sums it up this way: “You become financially free when your passive income exceeds your expenses.”
Related Articles on Passive Income
Conclusion
When we talk about passive income, local lead generation is definitely our top pick. As you pursue the rank and rent model and then offer your digital properties to several small businesses in your area. As a result, you can create a passive income source that brings you a consistent stream of cash. You can live a better lifestyle and have greater peace of mind as you build a stronger foundation for your personal finance.
