Top 13 'Set-and-Collect' Passive Income Ideas to learn for Pragmatic Savers to Grow Their Nest Egg on Autopilot this year
We've all dreamt of it. The idea of money flowing into your bank account while you sleep, travel, or spend time on things you genuinely love. This is the seductive promise of passive income. But let's be pragmatic—true "get-rich-by-doing-nothing" schemes are usually just that: schemes. The reality is that meaningful passive income isn't about finding a magic money tree; it's about planting seeds and building systems that grow over time.
This is where the "Set-and-Collect" philosophy comes in. It acknowledges that there's upfront work involved. You either invest your time (to build an asset) or your money (to buy an asset). But once that initial "setting" phase is complete, the goal is for the income stream to become largely self-sustaining, requiring minimal ongoing effort to "collect" the rewards. It's about working smart now so you can work less later.
For pragmatic savers like us, the goal isn't to chase speculative fads. It's about strategically growing our nest egg on autopilot, using reliable methods that compound over time. This list of 13 ideas is curated for exactly that purpose. From rock-solid foundational strategies to more creative avenues, here are the top "Set-and-Collect" passive income ideas to learn and implement this year.
1. High-Yield Savings Accounts & Fixed Deposits
Let's start with the absolute bedrock of passive income. It's not the most glamorous, but it's arguably the most important first step. A high-yield savings account (HYSA) or a fixed deposit (also known as a Certificate of Deposit or CD) pays you a significantly higher interest rate than a traditional savings account for simply parking your cash. This is your money working for you with virtually zero risk.
The "set" is straightforward: research the best rates available from reputable banks or financial institutions and open an account. The "collect" is completely automated; interest is deposited into your account monthly or quarterly without you lifting a finger. This is the perfect place for your emergency fund or short-term savings, ensuring your cash isn't losing purchasing power to inflation.
Pro-Tip: Don't just stick with your primary bank out of convenience. Online-only banks often offer the most competitive rates because they have lower overheads. Spend an hour comparing options—it’s a one-time effort that pays dividends for years.
2. Dividend-Paying Stocks & ETFs
This is a classic path to building wealth. When you own a dividend-paying stock, you own a tiny piece of a profitable company that shares its earnings with you, its shareholder. These regular payments (usually quarterly) can be reinvested to buy more shares, creating a powerful compounding effect that snowballs over time. This is a core principle we often discuss on the Goh Ling Yong blog – making your money work for you.
For those who prefer a more diversified, hands-off approach, Dividend ETFs (Exchange-Traded Funds) are a fantastic solution. An ETF like the Schwab U.S. Dividend Equity ETF (SCHD) or the Vanguard High Dividend Yield ETF (VYM) holds a basket of hundreds of different dividend-paying stocks. You get instant diversification and a steady stream of income without having to research individual companies.
Pro-Tip: Use a low-cost brokerage or a robo-advisor to start investing. Set up an automatic investment plan to contribute a fixed amount each month. This strategy, known as dollar-cost averaging, smooths out market volatility and puts your wealth-building on true autopilot.
3. Real Estate Investment Trusts (REITs)
Dream of earning rental income without the hassle of being a landlord? Meet Real Estate Investment Trusts, or REITs. These are companies that own and operate income-producing real estate—think shopping malls, office buildings, data centers, or apartment complexes. When you buy a share in a REIT, you're essentially becoming a fractional owner of a massive property portfolio.
By law, REITs are required to pay out at least 90% of their taxable income to shareholders in the form of dividends. This results in a consistent and often high-yielding income stream. You can buy and sell REITs on the stock market just like any other stock, making them a liquid and accessible way to invest in real estate.
Pro-Tip: Look for REITs in growing sectors like logistics (warehouses for e-commerce), data centers (powering the cloud), or healthcare facilities. Diversifying across different types of REITs can also help mitigate sector-specific risks.
4. Robo-Advisors
If the idea of choosing your own stocks and ETFs sounds daunting, a robo-advisor is your best friend. These digital platforms use algorithms to build and manage a diversified investment portfolio for you based on your financial goals and risk tolerance. You simply answer a few questions, deposit your funds, and the platform handles the rest.
The "set" is the initial 15-minute setup process. The "collect" is the long-term growth of your portfolio. Robo-advisors automatically handle complex tasks like rebalancing (selling high, buying low to maintain your target asset allocation) and dividend reinvesting. It's the ultimate "set-it-and-forget-it" investment strategy for busy professionals who want their money managed efficiently and at a low cost.
Pro-Tip: Most robo-advisors allow you to set up recurring automatic deposits. Link your bank account and schedule a weekly or monthly transfer. This automates the habit of saving and investing, which is the single most important factor in growing your nest egg.
5. Peer-to-Peer (P2P) Lending
P2P lending platforms connect individual investors (like you) with borrowers who need loans, cutting out the traditional bank middleman. As an investor, you can fund fractions of many different loans and earn interest as the borrowers make their repayments. This can offer higher returns than traditional savings products, but it also comes with higher risk, as borrowers can default.
The key to success in P2P lending is radical diversification. Don't put all your money into a few loans. Instead, spread your investment across hundreds, if not thousands, of small loan portions. Many platforms have an auto-invest feature that does this for you automatically based on your chosen risk criteria.
Pro-Tip: Start with a small amount of capital you're comfortable putting at risk. Reinvest your earnings to take advantage of compounding, and thoroughly vet the platform's history, default rates, and fee structure before committing.
6. Affiliate Marketing on a Niche Website
This one requires more upfront time but has incredible "set-and-collect" potential. The concept is simple: you create a website or blog focused on a specific niche you're passionate about (e.g., home espresso machines, sustainable travel, marathon training for beginners). You write helpful, high-quality content that answers people's questions and solves their problems.
Within your content, you include special "affiliate links" to products or services you genuinely recommend. When a reader clicks your link and makes a purchase, you earn a commission at no extra cost to them. The "set" is creating a library of evergreen content that will attract readers from search engines for years. The "collect" is the automated income from clicks on articles you wrote months or even years ago.
Pro-Tip: Focus on being genuinely helpful, not just "selling." Write detailed reviews, how-to guides, and comparison articles. Authenticity builds trust, and trust is what drives conversions.
7. Create and Sell a Digital Product
Do you have a skill, expertise, or a solution to a common problem? Package it into a digital product. This could be an eBook, a set of design templates, a budgeting spreadsheet, a short video course, or a meal plan guide. The beauty of digital products is that you create them once, and you can sell them an infinite number of times.
The "set" is the creation and refinement of the product itself. Platforms like Gumroad, SendOwl, or Etsy make the "collect" part incredibly easy. They handle payment processing and automatic delivery of the digital file to the customer. Your main job after launch is marketing, which can also be automated to a degree through social media schedulers or email marketing sequences.
Pro--Tip: Solve a very specific problem for a very specific audience. Instead of a generic "fitness guide," create a "30-Day Post-Pregnancy Core Strength Guide." Niche products are easier to market and sell.
8. Selling Stock Photos, Videos, or Graphics
If you have a creative eye and a decent camera or design skills, you can create a passive income stream by selling your work on stock media sites like Adobe Stock, Shutterstock, or Getty Images. Photographers, videographers, illustrators, and graphic designers can all participate.
The "set" phase involves shooting/creating, editing, and uploading your content with relevant keywords. Once your portfolio is live, it becomes a digital asset that can be purchased by customers around the world, 24/7. You earn a royalty for every download, and a single popular photo or video clip can sell hundreds or thousands of times over many years.
Pro-Tip: Don't just upload your vacation photos. Think like a marketer. What kinds of images do businesses and bloggers need? Think about concepts like "teamwork," "technology," "healthy lifestyle," or "remote work."
9. Investing in Bonds or Bond ETFs
Often overlooked in favour of their flashier cousin, stocks, bonds are a crucial component of a balanced portfolio. When you buy a bond, you are essentially lending money to a government or a corporation, which agrees to pay you back with interest over a set period. They are generally considered safer than stocks and provide a predictable income stream.
For effortless diversification, Bond ETFs are the way to go. These funds hold a wide variety of bonds, spreading your risk across different issuers and maturities. They trade on the stock market like a stock and pay out interest (the "collect" part) on a regular basis, usually monthly. They add stability and income to your nest egg, acting as a cushion during stock market downturns.
Pro-Tip: Consider a "total bond market" ETF as a simple, all-in-one solution for adding bond exposure to your portfolio. It provides broad diversification across the entire U.S. bond market in a single fund.
10. Maximize Cashback and Rewards Programs
This is the easiest passive income stream to set up because it's based on spending you're already doing. Instead of using a debit card or cash, strategically use credit cards that offer generous cashback, points, or miles on your purchases. The key is to always pay your balance in full every month to avoid interest charges, which would negate any rewards earned.
The "set" is a one-time research effort to find the card(s) that best match your spending habits (e.g., a card that gives high cashback on groceries and gas). You can also use browser extensions like Rakuten or Honey that automatically find and apply coupons and cashback offers when you shop online.
Pro-Tip: Consider a simple 2-card system. One flat-rate card that gives 1.5-2% cashback on everything, and one card that gives 3-5% on your top spending categories like dining or groceries.
11. License Your Music
Similar to stock photography, this is for the musically inclined. If you create music—from full-length songs to short instrumental loops or sound effects—you can license your work on platforms like Artlist, Epidemic Sound, or AudioJungle. Content creators, filmmakers, and businesses are constantly in need of high-quality music for their projects and are willing to pay for it.
The "set" is producing and uploading your tracks. The "collect" is the royalty payments you receive whenever someone licenses your music. A popular track can generate income for years with no additional effort, creating a truly passive income stream from your creative passion.
Pro-Tip: Focus on creating music that fills a commercial need. Think upbeat corporate background music, cinematic trailer scores, or relaxing lo-fi beats for study playlists.
12. Start an "Automated" Niche YouTube Channel
You don't need to be a charismatic vlogger to succeed on YouTube. There's a whole world of "faceless" channels that generate significant ad revenue. These channels often use stock footage, screen recordings, simple animations, or slideshows with a voiceover to create content. Think channels that create rain sounds for sleeping, animated book summaries, or software tutorials.
The "set" is the hard work of scripting, recording voiceovers, and editing a batch of videos. But once a video is uploaded, it can be discovered and watched for years, generating passive ad revenue through the YouTube Partner Program. As Goh Ling Yong would agree, building a library of digital assets is one of the most powerful wealth-building strategies today.
Pro-Tip: Pick a niche with high search volume and low competition. Use keyword research tools to find topics people are actively looking for. Consistency is more important than production value in the beginning.
13. Rent Out Your Unused Assets
Look around your home. Do you have a spare room, a parking space you don't use, or a storage area that's sitting empty? These are assets that can be turned into passive income. Platforms like Airbnb (for rooms), Neighbor.com (for storage), or Spacer (for parking) make it easy to list and manage your space.
While managing a short-term rental can be active, renting out a room to a long-term tenant or a parking spot on a monthly basis is much more "Set-and-Collect." The "set" is finding a reliable tenant and signing an agreement. The "collect" is the monthly payment that arrives via direct deposit.
Pro-Tip: Don't stop at space. You can also rent out other assets like a car (via Turo), camera equipment, or even high-end tools. Identify what you own that others might only need temporarily.
Your Journey to Autopilot Income Starts Now
Building passive income isn't an overnight sprint; it's a marathon of smart, intentional choices. The goal isn't to get rid of your day job tomorrow, but to build resilient, diversified income streams that grow your nest egg and give you more financial freedom over time. The "Set-and-Collect" mindset is about building systems that work for you, long after the initial effort has been made.
Don't feel overwhelmed by this list. The most important step is the first one. Pick just one idea that resonates with you—perhaps the easiest one, like opening a high-yield savings account, or the one that excites you the most, like starting a niche blog. Take a small, concrete action today to set your plan in motion.
Which of these "Set-and-Collect" ideas are you most excited to try this year? Share your thoughts in the comments below—I'd love to hear about your plans! And if you found this guide helpful, be sure to subscribe for more pragmatic financial strategies to help you build a wealthier future.
About the Author
Goh Ling Yong is a content creator and digital strategist sharing insights across various topics. Connect and follow for more content:
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