Written By Kevin Payne
Although you earn a six-figure salary as a physician, with rising inflation and other economic uncertainties, you might be actively cutting expenses. But there's only so much you can cut.
Instead, there are plenty of ways to boost your income as a doctor, and some of them don't require a ton of extra work. By adding passive income streams, you can make more money to add to your savings or pursue other passions.
Keep in mind that few income streams are truly passive. The amount of work (at least upfront) needed to start each side hustle or income stream can vary considerably.
Here's a look at seven popular passive income ideas for doctors.
7 passive income ideas for doctors
Note that the amount of income you can potentially generate with each income stream depends on several factors, including the time and money you invest into it, investment choices, and maybe even a little luck.
1. Real estate investing
Real estate investing is a popular way to generate income and build wealth. Plenty of doctors pad their income through passive real estate investing. There are several ways to invest in real estate with varying degrees of passivity.
Passive real estate investment choices include:
- Rental properties (long-term).
- Short-term rentals (Airbnb, VRBO, etc.).
- Real estate crowdfunding.
- House flipping.
Real estate investing can be lucrative, but it also comes with considerable risks and often requires time and money upfront before you see a return on your investment. Though, you don't have to do all the work either. You can hire contractors to renovate properties for sale or rent. You can also hire a property manager to take care of the day-to-day responsibilities with your investment properties.
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2. Invest in REITs
Another way to invest in real estate is through real estate investment trusts or REITs. Think of REITs like mutual funds, but for real estate. Instead of investing in individual properties, you invest in a company that owns, operates or finances real estate investments.
REITs historically offer competitive returns, typically with less risk than other investment types. They’re a popular investment option, with more than 145 million Americans owning REITs in some form. If you're looking to dive into real estate investing or diversify your portfolio, REITs might be a good place to start.
3. Dividends from stocks and bonds
You've probably already started saving for retirement. Maybe you've dabbled in the stock market, too. Another way to build wealth passively is earning dividends from stocks and bonds. Not all stocks or mutual funds pay dividends, but many do.
Bonds don't pay out dividends but instead, pay coupon payments, or a fixed annual interest rate, often referred to as the coupon rate. The nice thing with bonds is that you'll know the interest rate it pays out at the time of purchase. There's no guesswork.
Earning a couple of percent in dividends doesn't seem like much, but it adds up quickly, depending on your portfolio size. You can withdraw your dividend earnings as income or reinvest them in more stock shares.
4. Peer-to-peer lending
Another way doctors can earn passive income is through Peer-to-Peer (P2P) lending. Several P2P platforms, like LendingClub, Peerform and Upstart, have emerged online over the last decade. These platforms offer consumers an alternative to borrowing money from banks and private lenders.
P2P platforms connect borrowers with lenders, like you. Instead of a traditional lender or bank, you’d act as the lender, loaning money to borrowers and earning income through interest.
Although you can invest in short-term loans for individuals, many peer-to-peer platforms offer ways to invest in a pool with other investors. That pool of funds is then distributed to several borrowers. Most platforms allow you to choose the risk level of your preferred borrowers, too. If you're looking for a more flexible passive investment, P2P lending might be a good option.
5. Invest in a business
Stocks aren't the only way to invest in companies. You can also invest in businesses by providing startup capital. Platforms like SeedInvest and WeFunder allow you to invest in various startups and small businesses.
In some cases, you can start investing in startups with as little as $100. This can be a straightforward way to earn passive income as a doctor. You can also slowly ramp up as you become more familiar with the process and find companies that align with your values.
6. Influencer marketing
The emergence of social media platforms, like TikTok and Instagram, has created led to the popularity of influencer marketing. By building an engaged followership, you can leverage your influence to sell products, land brand sponsorships and advertising deals, and more.
Perhaps the most successful example of this is Dr. Sandra Lee, better known as Dr. Pimple Popper. It's been reported that Dr. Lee earns upwards or $10K or more for sponsored Instagram posts. There's also Muneeb Shah, a Dermatology Resident better known as dermdoctor on TikTok, who has developed partnerships with brands like Aveeno, Cetaphil, and Neutrogena.
The same holds true for doctors who want to create a podcast or launch a YouTube channel. You'll need to invest time creating and editing videos or higher someone to do it for you. Both are great ways to use your medical expertise to make more money.
7. Start a blog
Starting a blog is a long-standing method for generating passive income. However, it’s perhaps the least “passive” income stream on our list. If you have a passion or a deep knowledge of a particular topic — whether about your physician expertise or personal hobbies — you can create a blog to generate extra income.
Blogging is lucrative with the right idea and some work upfront. But it’s also a competitive field, with millions of blogs and websites on the internet now.
To help manage this upfront time cost, you can hire a website designer or use an inexpensive or free website theme online for a DIY approach. Start creating high-quality content and grow your readership to earn money through:
- Affiliate marketing.
- Sponsored content.
- Advertising.
- Digital products (e.g. e-books, online courses, etc.).
Don't start a blog if you're looking to make extra income right away. It can take several years to build a blog into a profitable investment.
Learn how to generate more income through investing
Doctors can use any of the passive income streams above to make extra money and build wealth. Determine your financial goals and find a passive income stream that you’re passionate about and doesn’t get in the way of your day job.
Many ideas on the list above ultimately involve investing which is the easiest way to make extra cash without a ton of extra time and effort. Not only can investing help you pay off student loan debt, but it's also a vehicle to pursue greater wealth.
To help you become a savvier investor despite your existing medical school debt, we’ve developed our Six-Figure Debt to Six-Figure Net Worth Investing Course. It’s specifically designed to teach borrowers with $20,000 to $1,000,000 of student loan debt how to invest.
The frequently-updated course features several hours of content to help you manage money, save on investing fees, and other tips to help you navigate the world of investing. You'll even learn strategies to reduce your tax liability.
If you want to learn how to pay down debt and build up an investment portfolio, check out the Six-Figure Debt to Six-Figure Net Worth Investing Course today.
