Imagine making money while you sleep, seems like a dream? Well, it is — with the right investment apps. Passive income is getting paid for work that you did not really have to do on a daily basis. Now, with the help of technology, including your smartphone and apps that support investing your money even in micro amounts to avoid monumental losses.
In this guide, we’ll take a look at the best investment apps to earn passive income in 2025. Whether you’re a complete beginner or someone seeking to diversify an existing investment portfolio, these apps simplify the process of growing your money on autopilot.
What Exactly Is Passive Income?
The truth is — it wasn’t for us, relying on a single paycheck isn’t enough. Prices just keep going up, and most of us need additional sources of revenue to have anything approaching a comfortable life. Passive income offers financial security and the ability to have some free time.
The great thing about investment apps is that they’ve done the hard work for you. Once you’ve done the heavy lifting to set things up, your money never sleeps. And while you’re sleeping, watching Netflix, hanging out with friends or spending time doing fun things elsewhere on the internet, your investments continue to grow.
What Makes a Good Passive Income App?
But before we leap into the specific apps, let’s talk about what you should look for:
Low Minimum Investment: You shouldn’t have to have thousands of dollars to get going. The best apps allow you to start with just $5 or $10.
Automatic Features: When all else is equal, favor apps that have auto-investing, dividend reinvestment and portfolio rebalancing. These are the features that enable you to earn without continuously watching.
Low Fees: High fees will eat into your profit. Opt for apps with low or no commissions.
Security: Your money needs protection. Top apps offer bank-level encryption and are licensed by financial authorities.
Easy to Use: If you are lost on the app, you won’t use it. The user interface should be easy and intuitive.
Best Dividend Stock Apps
Dividend stocks can be thought of as receiving a paycheck from the companies you own. They pay for your services on a regular basis just because you hold shares in them.
Robinhood: Free Stock Trading for All
Robinhood upended the game by introducing commission-free trading. You’ll be able to buy dividend-paying stocks without fear that fees will eat into your profits.
Why it’s great for passive income:
- Zero commission on stock trades
- Dividends direct deposit to account of your choice
- Fractional shares allow you to purchase portions of expensive stocks
- Clean interface that beginners love
Best for: Investors who want control over their dividend stock picks without getting nickel and dimed to death in trading fees.
M1 Finance: The Auto-Pilot Portfolio Constructor
M1 Finance blends automated investing with customization. You make it investment “pie,” and the app automates, in a similar way to Betterment (which also makes use of Pies), the maintenance of an allocation you select.
Passive income features:
- Automatic dividend reinvestment
- Dynamic rebalancing ensures you stay on track with your portfolio
- Make custom or use expert-designed portfolios
- Establish a weekly or monthly automatic deposit schedule
Best for: Investors wishing to automate investment, but who still want control over their own dividend stocks.
Webull: Trade on Advanced Tools for Free
We recommend Webull for those who want more research tools than are typically available on free apps. You receive professional charts and analysis, and you pay zero in commissions.
Income-generating perks:
- Commission-free dividend stock trading
- Extended trading hours
- Trading on a demo to train without risk of losing money
- Interest on uninvested cash
Best for: Those interested in thorough research of dividend stocks before investing.
Robo-Advisors That Build Wealth Automatically
Robo-advisors are apps that invest your money for you, according to how much risk you’re comfortable taking and toward what end. They’re perfect for hands-off investors.
Betterment: Smart Investing Made Simple
Betterment asks you a few questions about your goals, and then automatically builds and manages a diversified portfolio for you.
Passive income advantages:
- Autopilot tax-loss harvesting saves you money
- Dividend-focused portfolio options
- Auto-rebalancing keeps investments optimized
- Automatic deposits and increases
- Management fee: 0.25 percent a year for the digital plan
Best for: Raw beginners who want experts to handle everything.
Wealthfront: High-Tech Wealth Building
Wealthfront employs various algorithms to earn you the maximum total return possible after taxes.
Money-making features:
- Automatic dividend reinvestment
- Daily tax-loss harvesting
- Competitive-yield cash account that pays high interest
- Free financial planning tools
- Management fee: 0.25% annually
Best for: Tech-savvy investors who love advanced automation.
Acorns: Invest Your Spare Change
Acorns takes your everyday purchases and rounds them up to the nearest dollar, then transfers the difference into an investment account. It is investing without really thinking.
How it generates passive income:
- Automatic round-ups (where your purchases are rounded up and the money is invested in a way that you won’t miss it)
- Recurring investment options
- Portfolio earns dividends and interest
- Found Money offers you cashback from one of its partners
- Pricing: Beginning at $3 per month
Best for: Those who have difficulty putting money away on a regular basis.
Real Estate Investment Apps
Real estate historically has also taken huge amounts of money. These apps changed that completely.
Fundrise – Start Investing in Real Estate for as little as $10
Fundrise allows you to make real estate investments on the cheap all over America.
Passive income potential:
- Quarterly dividend payments
- Portfolio appreciation over time
- Diversified across multiple properties
- Historical returns around 8-10% annually
- Minimum investment: $10
Best for: New real estate investors seeking professional management.
Arrived Homes: Purchase Shares of Rental Properties
Arrived makes it possible for you to purchase shares of rental properties on an individual basis. You receive rent return with regard to your portion of the ownership.
Income generation:
- Regular rental income distributions
- Property value appreciation
- Select the properties you wish to invest in
- Low $100 minimum per property
Best for: Those who want to own real rental units without becoming landlords.
RealtyMogul: Commercial Real Estate Investing
RealtyMogul specializes in commercial properties like office buildings, shopping centers and apartments.
Earning potential:
- REITs pay regular dividends
- Access to institutional-quality properties
- Both income-focused and growth-focused options
- Minimum investment: Depends on the offering (usually $1,000-5,000)
Best for: Investors with larger chunks of capital who want to invest in commercial real estate.
Peer-to-Peer Lending Platforms
These apps enable you to act as the bank, loaning money to individuals or businesses.
Prosper: Earn Interest by Lending
Prosper connects investors with borrowers. You finance loans, and you earn interest when borrowers pay back.
How you make money:
- Monthly interest payments
- Select loans by risk profile
- Diversify across multiple loans
- Past returns 3-8% based on risk
- Minimum investment: $25 per loan
Best for: Investors willing to take on moderate risk for the chance of higher returns.
Worthy Bonds: Simple 5% Returns
Worthy sells bonds backed by American business assets. It is simple: Buy bonds, get 5 percent a year.
Passive income features:
- Fixed 5% annual return
- $10 minimum investment
- Daily interest accrual
- No fees whatsoever
Best for: Risk-averse investors seeking predictable returns.
High-Yield Savings and Cash Management Apps
There are times when the best investment is just earning some interest on your cash.
Marcus by Goldman Sachs: High-Yield Savings Rates
Marcus has some of the highest savings rates offered, with no minimum balance or fees.
Money-earning benefits:
- Competitive interest rates (as high as 4%+ in 2025)
- No monthly fees
- FDIC insured up to $250,000
- Simple transfers in and out of other banks
Best for: Developing an emergency fund and making decent returns.
Wealthfront Cash Account: Now You Can Bank with Your Investments
A high-interest cash account with checking features, Wealthfront’s cash account alternative is one of the best in the business.
Passive income perks:
- Daily balance used to calculate high interest
- Partner banks are FDIC insured up to $8 million
- Free bill pay and debit card
- No account fees or minimums
Best for: Savers who seek high interest rates and easy access to their money.
Cryptocurrency Apps for Passive Income
Crypto isn’t just for trading. Some apps allow you to make passive income with virtual currencies.
BlockFi: Earn Interest on Crypto
BlockFi pays you interest for holding cryptocurrency in your account.
Income opportunities:
- Earn up to 8% on stablecoins
- Interest on Bitcoin and Ethereum
- Compound interest monthly
- Backed by major institutions
Best for: Crypto fanatics looking to generate yield on holdings.
Coinbase: Staking Rewards
Coinbase also allows you to automatically earn staking rewards on some cryptocurrencies.
Earning features:
- Automatic staking for eligible cryptos
- Earn while holding long-term
- Simple interface for beginners
- Educational rewards program
Best for: Beginners who want to make money studying cryptos.
Comparison Table: Which App Suits Your Needs?
| App Category | Best App | Minimum Investment | Ideal For | Growth Rate |
|---|---|---|---|---|
| Dividend Stocks | Robinhood | $1 | Self-directed investors | 2-6% yield |
| Robo-Advisor | Betterment | $10 | Hands-off investors | 4-8% return |
| Spare Change | Acorns | $5 | Beginner savers | 3-7% return |
| Real Estate | Fundrise | $10 | Property owners/renters/home buyers | 8-10% return |
| P2P Lending | Prosper | $25 | Aggressive investors | 3-8% yield |
| High-Yield Savings | Marcus by Goldman Sachs | $0 | Safety-conscious savers | 4%-5% annual |
| Cryptocurrency | Coinbase | $2 | Crypto savers | Varies widely |
Building Your Passive Income Strategy
You don’t have to choose just one app. The smartest investors have multiple apps to diversify their income streams.
The Beginner Portfolio: Begin with 50% in a robo-advisor such as Betterment, 30% in a high-yield savings app like Marcus and an additional 20% in Acorns for automatic investing. That gives you diversification with minimal risk.
The Balanced Portfolio: Dividend stocks (30%), real estate apps (30%), robo-advisors (25%), high-yield savings (15%). This is a strategy for growth without too much risk or, as it were, hit for income.
The Aggressive Portfolio: Invest more in high yielding options such as real estate investing (40%), P2P lending (30%), dividend stock growth (20%) and crypto staking (10%). The higher the potential return, the greater the risk.
Common Mistakes to Avoid
But for all the great apps, people tend to make dumb mistakes, too — and those that cost money are some of the most painful.
Pursuing the Highest Returns: Apps that advertise 20% returns often come with huge risks. Balance return potential with safety.
Overlooking Fees: Small fees can add up after decades. That 1% fee may not seem like much, but it could end up costing you tens of thousands over three decades.
Not Spreading It Around: Placing all of your money in one app or type of investment is risky. Diversify across asset classes.
Exiting Prematurely: Passive income investing doesn’t happen over weeks; it happens over years. Allow your investments to grow with compounding.
Investing Emergency Funds: Do not invest money you will need to access in at least a year. Maintain 3-6 months of expenses in a regular savings account.
Tax Considerations for Passive Income
There are different tax rules for various types of passive income.
Dividends: Qualified dividends are taxed at a favorable rate (0-20% based on your income level). Unqualified dividends are taxed at ordinary income rates.
Interest Income: Money from a savings account, or bonds and even P2P lending, is considered ordinary income and gets taxed at your regular rate.
Real Estate Income: Dividends from REITs can receive special tax treatment. Certain real estate appreciation is subject to long-term capital gains rates.
Crypto Earnings: Crypto is property in the eyes of the IRS. Rewards from staking are treated as income when they’re received at fair market value.
Most apps will send you your tax docs (like 1099s) at you without any additional input. If you make good passive income, it might be worthwhile to use tax software or speak with an accountant. Learn more about investment taxes and strategies from the IRS.
Getting Started Today
The optimum time to develop passive income was yesterday. The second best time is now.
Step 1: Pick one or two apps that align with your goals and comfort level. You don’t want to crowd yourself with too many at once.
Step 2: Start small. Even $10 or $25 is a start. You can always add more later.
Step 3: Automate your deposits. Automation takes the emotion out and adds consistency.
Step 4: Check your progress once a month. See how your passive income rises over time.
Step 5: Slowly diversify to other apps and types of investing as you learn and pay off debts.
The Power of Starting Now
Here’s something that might come as a surprise: If someone invests $100 per month beginning at age 25, that person will have more money than if an individual contributes $200 per month starting at 35 — assuming the same 7 percent annual return. Time is your biggest advantage.
These investment apps take the friction out of accumulating wealth. You don’t need to be rich, have a finance degree or labor for hours over your research. The technology does a lot of the work for you.
Each dollar you invest today works for you tomorrow, next month, next year, and for decades down the line. That’s the real magic of passive income — your money grows while you go about living your life.
Frequently Asked Questions
How much would I need to invest in order to gain passive income?
You can get started on most apps for as little as $5-10. Fundrise, Betterment and Acorns all have very low minimums. The solution is to begin — not when you have thousands of dollars.
Is passive income even passive, or is it a scam?
It is true, but “passive” does not mean “instant” or “without effort.” You have to invest your investments at the beginning, and tend them once in a while. But once set up, your money is busy without daily intervention. It’s not a get-rich-quick plan — it’s a build-wealth-slowly plan.
Which app gives the best return?
Returns vary by risk level. Real estate apps like Fundrise average 8-10% a year. P2P lending can offer 5-8%. Dividend stocks typically yield 2-6%. Remember that in general, the higher the returns, the higher the risk. Spreading out across multiple apps is the optimal strategy for risk-adjusted returns.
Are these apps safe to use with my money?
Legitimate investment apps have bank-level security and encryption. The vast majority are registered with the SEC or other financial regulators. But keep in mind that the majority of investments aren’t FDIC insured (with the exception of savings accounts). Never put in more money than you can stand to see move up and down in value.
When can I expect to start earning real passive income?
This will vary with how much you invest and the returns. At $100 per month and 7% returns, after a year you will have about $1,200 (or generate around $40 in passive income). In five years you’ll have around $7,200 (earning about $500 every year). It snowballs in value over time through the magic of compounding.
Do I have to pay taxes on passive income?
Yes, most passive income is taxable. Dividends, interest, rental income and capital gains are all taxed. Many apps will automatically issue you tax forms (1099s) at the end of the year. Track your investments and maybe make an appointment with a tax professional if you start earning a significant passive income.
Can I get my money out whenever?
This varies by app. Stock and savings apps usually allow withdrawals at any time, though the value you withdraw will fluctuate based on market performance. Real estate app 5-year investment timelines tend to be the norm. Money is tied up until loans mature in P2P lending. Make sure to always check withdrawal terms before you start trading.
Do I want to use one app or more than one?
Multiple apps provide better diversification. You might want to try out 2 or 3 apps and diversify the types of platforms you’re using (for example, one robo-advisor app, one dividend stock app and one high yield savings app) to start with. That spreads your risk and diversifies your sources of income.
What about when the app company shuts down?
Your investments tend to be held by third-party custodians (such as Apex Clearing or DriveWealth), not the app. Your funds, in the name of an entity separate from those apps, are with custodians, at least for now — the fallback if the app company goes under. However, investment amounts are still subject to market risk.
Do I have to be an experienced investor to work with the apps?
No experience required! These are beginner-friendly apps. Robo-advisors such as Betterment and Wealthfront make investment choices for you. Even the stock app Robinhood has some educational resources. Begin small, learn along the way and slowly accumulate your knowledge and investment.
