Best Passive Income Strategies in 2025: My Real Experiences

Did you know that I created a company, 3 blogs, 3 Youtube Channels, and developed 2 Mobile Apps from scratch for the last 3 years to test what are the best strategies to generate passive income? At BYO Banking, the goal is clear: I'd like to help you build income streams that work for you, not the other way around. I have the feeling, with so many possibilities of generating passive income today, learning how to be your own bank is more relevant than ever.

Whether through automation, investing, or digital entrepreneurship, there are more opportunities than ever to make your money and skills generate income passively.

What Is Passive Income Really?

Before diving in, let’s clear up a common misconception: not all passive income is created equal.

There are three main sources of income:

1. With money: e.g. investments, crypto, or real estate

2. With time and effort: e.g. writing, coding, content creation

3. Via inheritance or gifts: rare, but technically the most passive

True passive income typically comes from your money working for you: assets generating interest, dividends, or rent. The more time and active effort required, the less "passive" it becomes.

Ranking Passive Income: My 10 Proven Strategies 🏆(2025 Edition)

Over the past 3 years, I’ve tested and implemented a wide range of passive income approaches. Here’s a breakdown: from most passive to most effort-intensive, along with my real results.

1. Investing in Stocks, ETFs & Bonds ✅ Most Passive

I began investing at 18 with a Spanish bond that paid ~4%: seeing €200 in gains without lifting a finger sparked everything.

Since then, I’ve used Dollar Cost Averaging (DCA) to invest ~10% of my salary monthly into ETFs, and Crypto. Even with as little as 1–2%, long-term compounding works wonders. Historically, I’ve seen 5–7% annual returns—more than my salary increases—with a fraction of the effort. See this guide for a full guide to the best ETFs and stocks.

This is, without doubt, my most passive and consistent income stream.

2. Investing in Crypto ✅ Most Passive

I started in 2015, investing small amounts monthly into Bitcoin and Ethereum. This strategy paid off so well that part of the returns helped me buy an apartment. Click here for a guide to crypto.

Today, I continue with DCA and hold long-term because the crypto market is still outperforming most of my ETFs, especially in Germany, where crypto gains are tax-free after 12 months, making it one of the top crypto havens.

3. Real Estate Rental Income

In 2019, I co-purchased an apartment in Barcelona with my sister. After covering taxes and mortgage costs (~€1,000/month), the rent covers itself.

While managing a rental takes some admin work, it’s mostly passive and represents solid long-term wealth building.

4. Creating Mobile Apps

I launched two apps:

• BudgeBuddy: A budgeting app synced with Google Sheets. Built for free use, but traction has been slow.

• MyDog App: A dog training app with AI features (breed & emotion detection, quizzes). Early feedback has been promising: 100+ installs in 2 weeks.

  
  

The upfront development was intense, but once launched, these apps require minimal upkeep. Monetization is via a freemium model and optional support (BuyMeACoffee).

5. Blogging for Passive Income

Writing is my favorite creative outlet. I’ve built:

• BYO Banking

• Two Travelling

• MyDogApp

Content creation is a slow burner. Monetization only starts after consistently producing quality articles, usually around the 100-post mark. For me, this was only possible during a sabbatical.

Still, once traffic builds, blogs can generate income via Adsense, affiliate links, or digital products with minimal ongoing work.

6. YouTube Channels

I created three YouTube channels:

• Travel Channel: Drone and GoPro footage. ~150 subs, no monetization.

• BYO Banking Channel: Finance-focused. ~70 subs with semi-automatic video generation using inVideoAI, but I preferred writing, so I stopped the video generation for now.

• Dog Shorts: Quick tricks from my golden retriever, Mali. 14 subs from just 2 shorts: animal content has strong viral potential.

While fun and potentially scalable, video editing takes time, making it less passive unless you hire help or automate.

7. Affiliate Marketing & Referral Links

This can be passive if your content generates consistent traffic. I use affiliate/referral links for tools I recommend, but success depends on ongoing content updates.

In my experience, Amazon affiliates have underperformed, while niche-specific referrals (especially in crypto or finance) offer better returns.

8. Creating a Company

I formed BYO Banking in Germany to unify all my digital and app-based ventures. It’s a legal and financial framework that helps consolidate revenue, expenses, and future opportunities.

It’s not a passive income source per se, but it structures my income streams professionally—vital for long-term scaling.

9. Optimizing Taxes (Legally!)

Reducing costs is one of the easiest ways to increase net income.

In Germany:

• Hold crypto over 12 months = 0% capital gains tax

• Deduct work-related travel, clothing, and home office

• Hire a tax consultant: mine saved me more than their fee

  
  

In Spain:

• Deduct mortgage commissions for rental properties

• Offset repair costs and depreciation

Smart tax planning feels invisible but has tangible ROI.

10. Writing Books, Building Games, or Creating Digital Products

This takes significant effort upfront. Writing a book or developing a game might require weeks (or months) of work—but once published, they can become true passive assets.

What matters most? Consistency. From blogs to books to apps, the “magic number” seems to be 100:

• 100 blog posts

• 100 YouTube videos

• 100 engaged users

Persistence is your greatest asset.

Final Thoughts: There’s No Magic Formula

Most people want passive income without effort. But the truth is: the passivity comes after the effort.

Whether you're investing capital or time, the key is to:

• Solve real problems

• Deliver consistent value

• Stick with it long enough to see compounding work its magic

  
  

👉 Start small. Stay consistent. And build your own bank.