Investing for Monthly Income: 20 Investments That Will Make You Monthly Income in 2022

Daniel Williams
Daniel Williams
Senior Property Writer
Updated 14 December, 2021
7 Min Read

Investments That Will Make You Monthly Income Investments That Will Make You Monthly Income

Whether you’re thinking of early retirement or just want some extra cash on the side, investing for monthly income is a top choice in 2022. 

But with so many asset classes and investment funds out there, you may feel overwhelmed at your available choices and not know where to start. 

Well, don’t worry, as this guide is perfect for you. 

Below you will find 20 passive income ideas for you to start earning monthly income in 2022. 

Topics on this page include: 

  • How to Invest for Monthly Income? 
  • What is the Best Way to Invest for Monthly Income? 
  • How to Get Started With Investment for a Monthly Income 

Keep reading for 20 passive income ideas for monthly income.  

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    Residential Rental Property Residential Rental Property

    1. Residential Rental Property 

    Perhaps one of the first passive income ideas that comes to mind for earning monthly income is residential rental property. 

    A must-have for any serious investment portfolio, residential rental property investment has exploded in popularity over the last year thanks to its huge growth in income potential. 

    With residential real estate, investors will buy a property and rent it out to a tenant. This means that residential real estate delivers two forms of income. 

    1. Rental income – A regular monthly income stream that reached a record-high in the UK rental market in 2021, hitting £1,061 per month in September 2021 according to HomeLet. 
    2. Capital growth – Otherwise known as capital gains or capital appreciation, capital growth is the increase in a properties value over time. UK property prices increased at their highest rate in 2021 since 2004, reaching an average of £250k for the first time ever. 

    This is what makes property an effective solution for those thinking ahead to retirement, as investors can earn regular rental income and can also secure a huge profit when they sell their assets later down the line. 

    While this asset class can deliver an effective monthly income stream, you need to be aware that there are ongoing costs with real estate including property management fees and interest payments if you use a buy to let mortgage. 

    Overall, we estimate that you’ll likely need a minimum initial investment of around £30k, which includes property taxes and a BTL mortgage initial deposit and down payment of 25% if you want to secure an effective residential property. 

    You can learn more about property investment by reading our ultimate guide for 2022. You can also see if now is a good time to invest in property by reading our brand-new property guide. 

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    Dividend Paying Stocks Dividend Paying Stocks

    2. Dividend Paying Stocks on the Stock Market 

    One of the more risky investments on this list but still incredibly popular amongst investors, the stock market is an excellent asset to invest in to get monthly passive income. 

    However, we’ve specified dividend-paying stocks here as not all stocks pay monthly income. 

    A dividend is a portion of a companies profits that is paid out to shareholders based on how many shares they have. Depending on the company, it can be paid out monthly, quarterly, or every year. 

    Not all companies pay out dividends to their shareholders and instead can re-invest these profits. 

    Finding the right dividend stock can be quite tricky, and it isn’t as simple as investing in the big FTSE 100 or FTSE 500 on the stock market. 

    You need to keep an eye on the earnings and revenues of a company and ensure that the company is not in debt to secure a sustainable dividend. 

    Likewise, you need to avoid being caught in “dividend traps” which refers to shares that, on the surface, offer very high dividends but aren’t a good investment.  

    This is usually because a rise in a share’s yield can mean that share prices are falling, which could mean that dividend payouts are set to drop.  

    However, if you can find the right blend, dividend income can be sizeable for securing a regular monthly income, but you should be wary. Stocks aren’t historically known as safe investments, with 2020 seeing the stock market suffer its worst crash since 1987. 

    Check out our guide to property vs stocks to learn more. 

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    Student Rental Property Student Rental Property

    3. Student Rental Property 

    Another way of securing passive income by making an investment in real estate is through student rental property. 

    You can buy student rental property in the UK in two main ways. 

    1. You can buy purpose-built student accommodation: Likely the top choice in 2022, with Savills reporting that over £5.77 billion was spent on PBSA in 2020 – a record-high. 
    2. You can buy a house of multiple occupancy, otherwise known as HMOs: Historically a popular choice, with multiple tenants paying rent and increasing the income generated. 

    Like residential real estate, student property is a top passive income investment, allowing investors to earn both rent on a monthly basis and long-term capital appreciation. 

    Student property generates some of the highest rental yields out of all real estate assets thanks to high rental income and low property prices typically below £100k – In fact, our student property City Point was available for purchase from only £59,995 and offered 8% NET rental yields. 

    While the minimum investment for student property is less, it also offers less capital appreciation potential than residential property, which is something to keep in mind for investors looking at retirement.  

    You will also need to pay additional fees such as property management fees when buying a purpose-built student apartment. 

    Overall though, if you’re a buy to let investor looking for dependable income and want to invest money in real estate, student property is a top choice. You can learn more by reading our complete guide to student property investment in 2022. 

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    Mutual Funds Mutual Funds

    4. Mutual Funds 

    As a way of investing in stocks or bonds, investing in a mutual fund can be a smart choice for beginner investors in 2022. 

    mutual fund is an investment vehicle that uses money pooled from investors to invest in assets like stocks and bonds.  

    Mutual funds are managed by fund managers and professional money managers who allocate the funding gained from investors into the right assets in order to generate income for their investors. 

    By investing in mutual funds such as exchange-traded funds (ETFs), investors have access to a professionally managed investment portfolio for far cheaper than they expected, with the potential to earn three forms of income. 

    They are: 

    1. Investors can earn income from dividends or interest depending on what type of asset the mutual fund invests in. The fund will usually give the investors the choice of receiving their income or re-investing for more shares. 
    2. Investors can earn capital gains when the fund manager sells assets that increased in price. 
    3. Investors could see their shares increase in price, which they can then sell on.

    With plenty of mutual funds to choose from, such as the prior mentioned exchange-traded fund, fixed-income funds, index funds, equity funds and more, investors have plenty of choices to determine what option is right for them. 

    As mutual funds offer so much choice for investors, it’s undoubtedly a top choice for the best monthly income investments. 

    Government Bonds Government Bonds

    5. Government Bonds 

    Those looking for safe investments and want to know how to invest for monthly income, government bonds can be an interesting solution. 

    A government bond is a debt issued by a government to raise funding for projects and government spending. 

    Sometimes known as sovereign debt, investors are able to buy bonds, that can be sold via auction, and will then receive interest payments based on the amount of debt of the bond. 

    As a way to generate monthly income, government bonds can be a top choice as there is little chance of the government defaulting on payments. 

    However, if you secure a fixed-rate government bond, you could run the risk of interest rate risk, which is when an interest rate is higher than the fixed-rate, meaning you’ll be earning less than you normally would on a variable rate. 

    But while fixed income can fall behind rising inflation and interest rates, and the rate of return is lower than assets like property, bonds will pay a regular income and are incredibly liquid if you want to re-sell. 

    Commercial Rental Property Commercial Rental Property

    6. Commercial Rental Property  

    Our third real estate option on this list, commercial rental property is another investment offering consistent income every month. 

    Investors can buy a unit in a commercial building, like an office block, retail space, or industrial space, and can then rent out the premises to companies or businesses. 

    The main benefit of commercial real estate over other rental properties is longer lease lengths, which means you’ll have access to tenants for longer and can therefore consistently see returns without running the risk of void periods 

    However, these investments can get tricky, with it far harder to actually find business tenants. Likewise, if you’re looking to finance your deal, buy to let mortgages are also harder to find and can often incur higher deposits and interest payments.  

    As such, while this can be a good choice for a real estate investor, it may not be the best way to invest for monthly income. 

    Holiday Real Estate Holiday Real Estate

    7. Holiday Real Estate 

    A top choice if you want to buy real estate you can live in, holiday homes allow investors to rent out a home on a short-term basis to a holiday goer or tourist. 

    Typically listed on websites like Airbnb, those owning a holiday home, whether that be based in the UK or abroad, can live in their holiday home while travelling, and can then rent it out when not in use. 

    Although, if you wish to do this, keep in mind that it won’t be possible to live in a home purchased with a buy to let mortgage. Likewise, if you buy it with a residential mortgage, you won’t be able to let out the property. 

    Investors can produce monthly income from a holiday home, which could be considerable depending on its size and quality. However, securing a BTL mortgage can be tricky, and you could encounter large void periods if the area’s tourism is based on seasonal demand. 

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    Real Estate Investment Trusts Real Estate Investment Trusts

    8.Real Estate Investment Trusts 

    Want to invest in real estate but don’t have the cash required to own property directly? 

    Well, a top choice for you could be a real estate investment trust. 

    Real estate investment trusts, often abbreviated as REITs, are companies that own, finance, and manage properties on behalf of investors. 

    Similar to mutual funds, a REIT will pool cash gained from investors and use it to purchase real estate investments.  

    Most REITs are typically traded like stocks, which makes them an incredibly liquid asset, unlike traditional real estate investments. 

    This can be a far easier way to invest money in property, but keep in mind that due to the lower entry fee, returns will be far below that of buy to let property.  

    You can learn more about investing in real estate by checking out our 2022 guide to the best property investment strategies. 

    Invest in Cryptocurrency Invest in Cryptocurrency

    9. Cryptocurrency 

    Booming in popularity across 2021, cryptocurrency is fast becoming one of the most popular ways of investing for younger generations. 

    Cryptocurrency is a digital form of money that can be purchased and traded online. 

    Often hailed as one of the most confusing investment concepts like NFTs, a unit of cryptocurrency is worth the same amount as a traditional currency. For instance, one bitcoin is worth £38,933.73 at the time of writing in December 2021. 

    Although most investors hold onto cryptocurrency and sell it at a later date for capital growth, there are ways to use this contemporary asset to generate monthly income. 

    Firstly, investors can lend cryptocurrency to others and earn interest. Secondly, a buyer can also place their cryptocurrency into an interest-bearing account and earn a fixed interest rate. 

    You need to be cautious when investing in cryptocurrency as it’s a very new and unregulated medium. As Time magazine put it: “You have a high chance of losing it all, but a small chance of winning it big.” 

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    Cash ISA and Stocks and Shares ISA Cash ISA and Stocks and Shares ISA

    10. Cash ISA and Stocks and Shares ISA 

    A safer investment compared to many on this list, a cash ISA is a savings account that you don’t pay tax on. 

    Everyone in the UK over the age of 16 is allowed an ISA allowance each tax year of up to £20,000, and you can only open one cash ISA per year. 

    Perfect for those looking to save some cash and earn interest, there are plenty of different types of Cash ISAs that offer varying levels of interest rates. 

    These include easy access and fixed rate, which currently offer highs of 0.67% and 1.7% AER respectively depending on how long you’re willing to store your cash for. 

    You could also consider investing in an investment ISA, otherwise known as stocks and shares ISA, which allows you to invest in funds, or research and find your own shares.  

    Stocks and shares ISAs allow investors to earn more than a cash ISA, but you run the risk of losing out on income as the value of investments can go down. Also, remember that both ISAs share the same tax allowance, so you won’t be able to invest £20k in both. 

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    Real Estate Crowdfunding Websites Real Estate Crowdfunding Websites

    11. Real Estate Crowdfunding Websites  

    Real estate crowdfunding is a more niche way to make a property investment in 2022. 

    A property crowdfunding website is a platform that pools investors funds together to purchase a property. 

    Once the website generates enough cash, it will then form a limited company, with all investors given a share in the company representative of the amount of cash invested. 

    This can be a top choice to generate steady monthly income without having to spend the cash required of a full property investment. 

    The downside is, though, that you’ll have no control of how the property is managed, or if it’s even kept or sold.  

    Corporate Bonds Corporate Bonds

    12. Corporate Bonds 

    Working in a similar way to government bonds but riskier, a corporate bond is a debt issued by a company to raise cash for operations. 

    By buying a corporate bond, an investor will be lending money to a company and will therefore receive a return on investment via interest payments. You could also re-sell the bond. 

    Due to the riskier nature of corporate bonds vs government bonds, you will encounter higher interest rates, with investment-grade bonds given a rating based on their risk, with Triple-A bonds offering the lowest yields but the highest safety.  

    You can buy a corporate bond from £1,000, meaning it requires less initial investment than an asset like property or cryptocurrency, but with far less income potential. 

    Peer to Peer Lending Peer to Peer Lending

    13. Peer to Peer Lending 

    Allowing investors to lend money to other individuals by cutting out banks and other lenders, peer-to-peer lending has shot up in popularity since its introduction in 2005. 

    Using peer to peer lending platforms like Lending ClubUpstart, and Peerform, investors can choose to lend their cash to other individuals and earn interest in return.  

    By cutting out banks and the middle man, you will likely see better returns without your bank taking a cut.  

    P2P lending recently received its first UK government backing, with the first £1,000 tax-free for basic rate taxpayers. However, at the time of writing, P2P lending is not covered by the Financial Services Compensation Scheme, so you are at risk of losing your capital. 

    Loanees could also default on their interest payments, so you may end up losing out on income. Be sure to speak to a trained financial expert to see if this strategy is the right way of investing for monthly income for you. 

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    Savings Account Savings Account

    14. Savings Account 

    Likely the best way to invest your hard-earned cash safely, a standard savings account is a top way to save money for the future.  

    However, with UK interest rates reaching record-lows, savings accounts have been hit hard. 

    But that doesn’t mean savings accounts are no longer viable with plenty of options out there to choose from. 

    There are three main types of savings accounts at your disposal, with easy access, notice, and fixed-rate accounts available in 2022. 

    1. Easy-access accounts allow investors to withdraw their cash at any time, but will typically receive interest at a lower rate than the other accounts. 
    2. Notice savings are the ideal midpoint, with investors needing to provide notice before they make a cash withdrawal – typically between 30 to 120 days. 
    3. Fixed-rate accounts mean you’ll need to lock your cash away for a set time, ranging from one to five years. While you won’t get cash in the short term, locking your finances away will mean you get access to the highest interest rates available. 

    While you won’t earn monthly passive income anywhere near other options on this, it can be a top choice for those unwilling to risk their capital at this time. 

    Money Market Funds Money Market Funds

    15. Money Market Funds 

    An increasingly popular type of mutual fund that deserved its own mention, money market funds are mutual funds that invest in highly liquid assets like corporate bonds, commercial paper, and overnight bank deposits. 

    By investing in these assets, return potential is far lower than funds that invest in shares, but the trade-off is that your capital will be far less at risk. 

    Due to the low risk, money market funds are a top alternative to savings accounts and can deliver a decent monthly income stream in addition to other investments. 

    16. Laundry Machines/ Washing Machines 

    A strategy you may not have thought of, investors can buy laundry machines or a laundromat to generate a regular income stream from passive income. 

    Laundromats can be a surprisingly successful investment, allowing a flexible work-life balance and a top return on investment. 

    In fact, a poll from Gallup found that 95% of laundromats succeed over a five-year period. 

    While it may not be the obvious answer to “what is the best way to earn monthly income?” it can be an interesting solution for you in 2022. 

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    Guaranteed retirement income & annuities Guaranteed retirement income & annuities

    17. Annuities 

    Guaranteed retirement income, or annuities, are a strong choice for those planning for retirement. 

    An annuity converts your savings built up for a pension into an annual income guaranteed for life. 

    In the UK, if you’ve built up cash throughout your working life into a defined contribution pension scheme, you may be stumped with what to do with the cash as you enter retirement age. 

    But one choice is buying a lifetime annuity, which will pay you a regular income for the rest of your life. 

    There are several different types of annuities available, including short-term annuities, fixed-term annuities, joint life annuities, level annuities, and more. 

    You can learn more by reading the following guide from AgeUK. 

    18. Robo-Investing 

    Robo investing allows investors to save some cash while spending money. 

    Using apps like Acorn or Moneybox, you can round up your spending and invest the difference. Say you’ve bought lunch for £2.50, an app like Acorn will round this fee up to £3.00 and invest the 50p into stocks. 

    This can be an interesting way to earn passive income, but keep in mind that some returns will likely be minimal and won’t be suited for those looking to earn huge income for retirement. 

    19. Use Cashback Reward Websites

    In a similar vein to robo-investing, cashback reward websites allow you to earn passive income whenever you buy online.

    By using cashback reward websites, you will find affiliate links to buy products, allowing you to save money on items you want.

    Some websites, like Quidco and TopCashback, will even give you cash and vouchers for completing mundane tasks like surveys.

    While this isn’t an obvious investment, it’s a neat way of making savings that will feel like earning passive income to your bank account.

    20. Start a Blog

    We’ve spoken a lot about cash investing in this guide, and while this is certainly a top option for prospective investors, what if you invested your time instead?

    This is where our final entry on this list comes in. If you have a knack for writing or are passionate about a particular topic like knitting or travel, then you could turn your passions into income.

    By starting a blog and writing regularly, you will hopefully build a following big enough to catch the attention of companies. They could then ask you to do paid reviews of their products or provide affiliate links, with each click of the link putting money in your back pocket.

    While it could take a long time to reach a point that a blog becomes high income-generating, it could be worth your time if you’re passionate and don’t have the funds to make cash investments on this list. 

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    The Mill

    Invest With £60,000

    Liverpool Prices from £139,950

    Assured 6% NET Rental Return

    Grade 2 Listed Building

    Exclusive Investment Opportunity
    Liverpool Prices from £125,995

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    Stylish Liverpool Apartments

    Off-Market Property
    Manchester Prices from £200,000

    5% Projected Rental Return

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    FAQs

    You can start investing today if you have the cash required. However, how you invest will depend on what sort of asset you want to invest in. For instance, if you want to buy property, a property investment company could be a good choice if you’re a beginner.  

    A good place to start for any investment, though, is speaking to a financial advisor to assess your financial situation and if investing is right for you. 

    All investments on this generate monthly income, but the size of that monthly income will depend on the chosen strategy. For instance, real estate can see you generate monthly earnings upwards of £1,000, while Cash ISAs will produce far less.  

    The best investment for making monthly income will depend on how much income you want to generate, your financial goals, and your own personal financial situation. 

    If you have over £30k for instance, a top choice could be real estate that will likely generate enough passive income for your goals. You may also consider cryptocurrency, which has huge income potential in 2022. 

    You can read our specific guides to varying budgets to see what investments are more suited to your needs. Follow the links below to read our free guides. 

    Yes, you can invest for monthly income in 2022, with plenty of asset classes to choose from. You can earn dividends from stocks, an interest payment from corporate bonds, or rental income from real estate. Be sure to speak to a financial advisor to determine which strategy will fit your budget and financial needs. 

    How to Get Started With Investment for a Monthly Income?

    You can start investing today if you have the cash required. However, how you invest will depend on what sort of asset you want to invest in. For instance, if you want to buy property, a property investment company could be a good choice if you’re a beginner.  

    A good place to start for any investment, though, is speaking to a financial advisor to assess your financial situation and if investing is right for you. 

    What Investments Generate Monthly Income?

    All investments on this generate monthly income, but the size of that monthly income will depend on the chosen strategy. For instance, real estate can see you generate monthly earnings upwards of £1,000, while Cash ISAs will produce far less.  

    What is the Best Way to Invest for Monthly Income?

    The best investment for making monthly income will depend on how much income you want to generate, your financial goals, and your own personal financial situation. 

    If you have over £30k for instance, a top choice could be real estate that will likely generate enough passive income for your goals. You may also consider cryptocurrency, which has huge income potential in 2022. 

    You can read our specific guides to varying budgets to see what investments are more suited to your needs. Follow the links below to read our free guides. 

    Can I Invest for Monthly Income?

    Yes, you can invest for monthly income in 2022, with plenty of asset classes to choose from. You can earn dividends from stocks, an interest payment from corporate bonds, or rental income from real estate. Be sure to speak to a financial advisor to determine which strategy will fit your budget and financial needs. 

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    Choose RWinvest to Fulfil Your Real Estate Dreams Today 

    We hope you’ve enjoyed our guide to investing for monthly income in 2022. 

    If you want to learn more about real estate and are thinking of investing, then RWinvest is the perfect company for you. 

    We are an award-winning property investment company with over 17 years of experience in residential and student property.  

    You can find luxury property investments in the UK today from just £74,950 with up to huge 8% NET rental yields. 

    Speak to one of our property consultants today to learn more about the UK property investment opportunities on offer. 

    Alternatively, you can learn more about real estate by checking out the following free guides. 

    Daniel Williams
    Daniel Williams
    Senior Property Writer

    Daniel Williams is a senior property writer at RWinvest. Regularly publishing in-depth articles on topics such as the best investment areas in the UK and guides on how to invest, Daniel has a keen eye for statistics and analysing property market changes.