I started my career as an attending physician in July 2022. It feels much longer than that … in a good way. It’s partly because of the awesome patients I’ve been able to help. But also because of the massive mindset and financial evolution that my wife and I have undergone. Generating passive income as a physician has been a big part of that evolution.

A huge emphasis in achieving financial well-being and freedom is creating passive income. I should correct myself and say that the goal is to create leveraged income. As I’ve shared before, there really is no truly passive income. But leveraged income breaks the bond between your time and your income, freeing you up to practice medicine on your own terms. And to improve your overall well-being.

Before I had my financial epiphany, passive or leveraged income was a completely foreign concept to me. Heck, even a savings rate of greater than zero percent was a completely foreign concept to me. And if you are reading this now and these are foreign concepts, that is OK! It’s more than OK. It’s exciting! You are starting a journey just like I did that will bring you greater financial and overall well-being. 

I am still on this journey right there with you. When I started, I had no idea what I was doing. Now I have a half dozen streams of passive income. That means you can too! I am not special. Trust me. Ask my wife, family, or friends, and they will confirm. All it takes is a goal, a plan, and a healthy mindset.

Below, I share my four streams of passive income as a full-time physician. Not all of them are super lucrative, but they bring in money without me even trying. And as I build them, they will help me achieve financial independence. We have to plant the seeds first. It’s worth it. Do it with me!

1) Stock Dividends

Stock dividends count as passive income. They come into my account while I sleep. I reinvest all of my dividends currently, but you certainly could choose to spend them.

This is the easiest way to create a source of passive income. You should be investing in low cost, broadly diversified index funds in tax advantaged and even taxable accounts. This holds true even if you are a medical student or resident/fellow.

In addition to dividends, which can be used as a source of passive income, index fund investing is a safe bet to create huge amounts of capital gains as you let time and compound interest do their thing. This is my current stock portfolio. 

2) Real Estate Rental Income

I love real estate investing. I see it as a wealth accelerant for physicians. Personally, I invest in cash flowing multifamily residential properties with an expected cash on cash (CoC) return of 10% or greater. This means that the real estate that I invest in has cash flow. The tenants pay rent and that rent pays the mortgage, interest, maintenance, taxes, etc. And then there is extra that goes into my pocket. That is passive or leveraged income. My wife and I started with one investment property that puts about $1,000 in our pocket every month, with a CoC of 22%. We are also closing on our seventh property with an expected COC return of 12%. This is my favorite and greatest source of passive income for a physician.

3) Blog Sponsors

As you go about your financial journey, document it with a blog! That’s why I did, and beyond being a source of entertainment for me, it’s also a business — I have sponsors who generate passive income for me in the form of ads. My goal with my blog sponsors is that I only work with companies or services that I have actually personally used. This keeps the blog from getting clogged, supports my mission, and most importantly, brings together highly qualified and ethical tools whose goal is to help my readers! Though this is not a big source of passive income, it still brings in a decent amount of cash.

4) Affiliate Advertising

Affiliate marketing is where you refer people to a company and you are reimbursed when they buy a product or service, at no extra cost to the buyer. Ideally, you only are referring to companies or products that you believe in. I do this on my blog in the form of links and product reviews.

Passive income is great, but it’s not the be-all-end-all. You can also engage in slightly more active forms of income generation, like leveraging your medical knowledge. There are a bunch of ways to do this as a physician. Personally, I do medical surveys and consulting. Other ways include being an expert witness, doing chart review, or reviewing insurance claims. 

The beauty of these four strategies above is that they’re generally low-hanging fruit that any physician can take advantage of. But you don’t need to do all of them to have financial success as a physician. Even one source of passive income (or slightly more active income!) can add up to a nice extra sum every month. So pick your favorite, and go have fun.

What's your favorite way to generate passive income? Share in the comments below!

Jordan is a graduating fellow in plastic surgery at NYU.

Animation by Jennifer Bogartz