You might be wondering: What’s the difference between a side hustle and a passive income?
- A side hustle is a project you actively engage with: freelance work, tutoring, or part-time jobs.
- A passive income is something you set up once and then earn from continuously, with minimal ongoing effort.
Of course, even the best passive income ideas still need the occasional bit of fine tuning, but once set up, they’re one of the smartest ways to make money from home in the UK.
So, how to create a passive income? Here are our top recommendations. And don’t forget you can easily keep more than one on the go to maximise your income.
Buying and Selling Shares
Investing in the stock market has long been considered one of the best ways to generate passive income.
You do need a sizable pot with which to create a portfolio if you’re to see an income of around £1000 a month, but this is one of the least labour intensive options if you’re savvy when it comes to the stock market. If you’re not so confident, you can use a wealth manager like Nutmeg that will invest your money for you via an Exchange Traded Fund (ETF). Of course, there are risks to any investment but the returns can be great, especially if you take an active interest.
Investing in a Start-Up
Yep, Crowdcube and the like make it super easy for you to invest in a round of funding for a start-up which shows promise. Similar to the stock market, it helps if you take an active interest in trends. But what’s also great is that if you feel passionate about what a small brand is doing to change the status quo, you can show your support. A return on investment is a wonderful thing, but so is backing something you believe in.
Cashback Sites
If you do a lot of shopping online (who doesn’t?) you could be earning cashback every time you buy. Cashback sites work by using affiliate links so instead of going directly to the site where you’re going to shop, you go via a tracked affiliate link and get rewarded. You could be getting between £300 and £800 back per annum; not a huge amount but not to be sniffed at if you’d be spending online anyway. Quidco and TopCashback are the two leading sites.
Renting Out a Spare Room
If you have a spare room, why not rent it out? Fewer people can afford a mortgage today, but not everyone wants to live in a shared house, student-style. Many people who work in a city may also only need a room throughout the week (a Monday to Friday let), which means you can keep your weekends to yourself. However, people who do rent out a room tend to find that with a good lodger, it’s great to share dinners or a drink at the end of the day.
Renting Out Your Driveway or Parking Space
This is one of the best passive income ideas in the UK right now for 2025. If you’ve been searching “How do I know if I can rent out my parking space?” or “How much should I charge to rent out my driveway?”, JustPark has the simple answer for you.
By renting out your driveway or parking space with JustPark, you’ll connect instantly with over 10 million drivers across the UK. Many space owners earn between £500 and £3,000 a year and the first £1,000 is tax-free.
- Got a driveway near a train station? Rent it to commuters.
- Live near a stadium? Matchdays mean peak demand.
- Have a garage that sits empty? That’s valuable real estate too.
In fact, it’s been proven that local residents living near major venues can increase their annual income by up to 57% by renting out their driveways to attendees.
Explore More Stories in Our Side Hustles & Passive Income Series
This article is part of a series about side hustles and passive income. Interested to read more?
- Find out how Frani turned her expertise into a passive income stream online.
- Discover how Jeyda created a side hustle by spotting a gap in the UK bike repair market.
- Learn how Mike built a reliable passive income through affordable geo-tracking for SMEs.
- Or, if you’re ready to start your own journey, explore our top side hustle ideas UK residents are using to boost their income.
Some of the best side hustles from home don’t even require you to leave the house and this is one of them. List your parking space for free and turn your driveway into a steady stream of passive income.
