During the COVID-19 pandemic, some therapies that required close contact with people were placed on hold and some therapists had to find alternative ways to earn money. Many had to think outside the box for possible passive income strategies for therapists.
Although savings could be used to pay bills, it is not a sustainable option in the long run. Earning a passive income is one of the easiest ways to keep cash flow even when your regular work is unstable. Here is a quick overview of the passive stream of income and the best strategies and passive income ideas for therapists.
What Is Passive Income?
Passive income refers to money coming from a source that doesn’t require direct or active involvement to keep it moving or growing. Unlike a regular active income where you work to earn, a passive stream of income pours in without too much time or effort after your initial time or financial investment.
Some passive income ideas will require continual effort, such as running a YouTube channel, but most good strategies will continue to act as an additional income source after your work is complete. According to the US Bureau of Labor Statistics, the average wage of a mental health counselor is $47,660, so many therapists feel they need additional income.
Passive Income Strategies for Therapists: Types of Passive Income
Many mental health professionals use sources of passive income to help them make ends meet. These often require an upfront investment but can make a big difference in your finances. Keep reading for some strategies and ideas to get you started.
Rental Properties
This is money you earn from leasing a property or space. However, there are certain exceptions when defining rental properties as passive income. Check the rules that apply before signing it off as a passive income. Leasing a property to a corporation or partnership can also be classified as an active income.
Self-charged Interest
Money loaned to a pass-through business entity, such as an S-corporation or a partnership, can be considered as a passive income. Self-charged interest income or loss can be treated as passive under the law if the loan was used only for passive business activities.
Investing in a Business
Investing in a business is considered a passive income by the IRS. You can invest money but you can’t be an active participant in the business. This means you won’t be able to be involved in the running, managing, or operating of the business.
10 Best Passive Income Ideas for Therapists
1. Write and Sell an Ebook
As a professional therapist, you have a lot of experience and knowledge about mental health issues, and you have the communication skills needed to become a writer. Writing a book about stories you’ve come across and your perspective as a mental health professional will draw a lot of interest.
Turn your expertise into profit and take advantage of the reduced publishing cost of an e-book. Publishing online also makes it easier to distribute it worldwide for an additional income stream. Many people are looking for mental health tips these days, and you may have the expertise to help them.
2. Create Online Training Courses and Workshops
At the start of the pandemic, people were turning to free online courses and workshops to keep themselves busy. Create an online psycho-educational course using different topics about psychology and mental health. Online training courses and workshops are really helpful for those who are struggling with things like burnout, depression, and pandemic fatigue.
3. Write a Blog
Blogging can be a casual way of sharing your knowledge as a therapist. As a mental health professional, you can blog about things like self-care tips, depression help, and success stories. Once you gain some publicity and your following increases, you may find online businesses begin to reach out to you to offer an affiliate marketing partnership.
4. Vlog on YouTube
Start a YouTube to vlog and become a mental health content creator. Share tips about mental health care, self-care, and parenting. If your content is fun and unique, people will want to follow you or subscribe to your channel. Once your channel reaches a certain number of subscribers, you will be eligible to run ads and earn a passive income through YouTube videos.
5. Start a Podcast
If you are confident with public speaking, a podcast can be another platform for you to share your knowledge and stories. As an expert in psychology and mental health, creating digital products like podcasts can help spread knowledge and self-help tips to those interested in your particular niche. Once established, your podcast can be monetized by running ads.
6. Offer Online Therapy Sessions
Communication is a lot easier now with the use of the Internet and social media apps. Offer your services as a mental health professional by providing online individual sessions to clients worldwide.
There would be no need to ever pause your business again by moving part of your private practice online. Scheduling weekly online sessions can be an extra source of income, especially when you need to quarantine for a period of time.
7. Create a Psychology App
There are many people that would appreciate waking up to an app that helps them get out of bed in the morning. Get a tech-savvy friend to help you by creating an app while you supply the content. Later, as it gets going, employ freelancers to run the app for you.
8. Try Public Speaking
One easy idea of alternative income for therapists is to become a public speaker for seminars, workshops, conferences, and events. Take advantage of the COVID-19 situation by taking speaking gigs for schools and organizations without leaving your home.
9. Create a Mental Health Website
Creating a website is relatively easy nowadays. If you know how to use WordPress, you can create a website and fill it with content related to therapy, psychology, and mental health. Depending on the quality, a complete website can sell for a good amount of money.
10. Become a Design Consultant
If you understand technology and enjoy design, use your medical professional background to provide consultant services for UI/UX designers. A user experience (UX) designer could use your knowledge of human behavior to design better applications and websites.
Other Ways to Make Extra Money as a Therapist
- If you have your own house, rent some space. If you have your own building, consider renting out space to other occupants or business owners. You could either find a smaller place for yourself or share the premises while earning extra money from leasing space.
- Promote products with Affiliate marketing. Affiliate marketers promote products for an online business. Get paid commission by marketing a product for someone else. This can be done by promoting a product in a blog or on social media platforms with an affiliate link. Each time someone uses that link to buy the product, you earn a commission.
- Get a high-yield CD or savings account. Online banks offer high-yield certificates of deposit or savings accounts. Investing in a high-yield account will increase the return on your money far more than a normal savings account.
- Get paid by monetizing your Instagram account. Many therapists have turned to Instagram to help people gain followers and more therapy clients by offering a quick coaching program, or to participate in question and answer sessions. This could enhance your private practice income.
- Design something to help people destress. It could be deep breath recordings and exercises, or another product that you create and sell. Think out of the box and try to come up with ideas that will not only make you money but will help other people.
How to Make Passive Income for Therapists
A passive income for therapists secures financial security and stability. If you’re a therapist dealing with unstable job conditions, you can increase your income per month just by using strategies to earn a passive income. You can achieve a steady stream of cash by applying the latest trends and ideas for passive activities with a small amount of upfront work.
Passive Income for Therapists FAQ
Passive earnings through business activities and rental income are taxable according to the IRS Publication 925. Profits gained from these activities are declared and taxed just like income for regular or full-time work.
Passive income is a stable source of income that does not require as much time and effort to maintain. Having a passive activity while working a full-time job can provide you with extra cash flow and a cushion when your regular job becomes unstable. If you want to become a therapist, learning about alternative income sources may be beneficial.
Although passive income businesses are not quick money-making schemes, they are typically used as an extra source of money on top of a regular job. It will provide an increase in monthly income that can give you better financial security and stability over time.
Passive income loss occurs when a non-participant investor experiences financial loss. The taxpayer can claim passive income loss against passive gains for investments in business activities and property rental.
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