3 passive income ideas in France

Looking for passive income ideas while living in France? What is really passive income? Need to complement your monthly revenues in an effortless and easy manner? Let’s clarify first what is really passive income before sharing our top 3 preferred ideas. 

Table of Contents

Understanding passive income

Passive vs active income

  • Active Income: It is basically the income earned through your 9 – 5 job or business activity such as salaries, wages, and business revenue.  It is strongly correlated to exchanging your time for money. 
  • Passive Income: It is the money earned with a minimal effort and time from you side. It normally includes dividends and interests. Passive income is not correlated to your time. 

Some people consider passive income royalties, side hustles like drop shipping,  affiliate marketing from blogs, rentals, vending machines,  etc… but are those really passive? Not so much! as you would need to spend a great amount of time or initial effort to set it up.  

For example, it is true that you can get regular monthly income from a rented apartment. But how many hours have you spent looking for the right property, negotiating the mortgage with the bank, finding a good tenant, dealing with water leaks and works, etc… Is this really passive?

When does make sense to look for passive income?

Receiving passive income may not be the best decision for all of us. But why? Who would not like to earn money while sleeping? There are 2 important points to consider: 

1) In fact, passive income implies making an initial capital investment. So if you are still young and actively working, you may want to allocate that capital in a long term investment with high growth. For example, if you would have invested 1000€ in Apple stock 10 years ago, it would have grown 755%. 

2) Do not forget taxes!  Every time you get dividends, rentals, and interests you are entitled to pay income taxes in France. Especially income coming from real estate is highly taxed. You can read more here in our article about Taxes in France. 

Passive income makes more sense when you need to complement your monthly revenue

Example of passive income


Imagine your net salary is 3000€,  and your expenses are 3200€ (which means a monthly deficit of -200€). In addition, let’s consider that you have 100 000€ saved and available in your bank account. 

Let’s imagine that you invest that capital in an ETF distributing 3% dividends. Then you will get 3000€ a year, meaning 250€ a month (before taxes). This amount could cover your budget deficit. 

Our 3 passive income ideas:

Idea #1: Dividends from ETF's

It may sound easy to pick one company to invest in, but it takes some effort to do it properly. You will need to learn how the company makes money, risks, suppliers, read the financial statements and quarterly results, be aware of any news that may impact the company, etc. Then we are not talking anymore about ‘passive’. 

Therefore, our preferred way to invest in the stock market for passive income is through an ETF (Exchange-Traded Fund) (not a financial advice) which replicates an stock index or a market sector (like S&P500, MSCI World, CAC40, Banks, Real estate…) and includes many companies within. It also provides a good diversification.

A reasonable dividend yield is around 2% to 3% (past performance do not imply future returns). More than that, it may not be good, as probably the value of the ETF is not growing over time. You should avoid the dividend trap which is investing in a shrinking sector. Read more about ETFs in our blog

How to invest in an ETF? 

In France, it is better to invest through tax-advantage wrappers such as  PEA , PER, or Assurance Vie. However, not all ETFs are available within these wrappers (mainly limited to Europe) and you would need to wait some years till you can withdraw dividends. If you want to open a PEA we use and recommend BoursoBank (referral link with benefits for you and us). 

Another option would be to invest through a standard broker. You can withdraw the dividends immediately but will need to pay a 30% flat tax rate. We use and like Degiro (referral link with benefits for you and us) as simple to use and low fees. If you are an expert, you may want to use Interactive Brokers broker (more complex but more powerful). 

myFrenchMoney tip

To select an ETF, we like 'justetf.com' site as simple to use and you can easily compare ETFs. Our preferred ETF for our PEA is SPDR S&P Euro Dividend Aristocrats UCITS ETF' (code IE00B5M1WJ87).
For our broker account we like Vanguard FTSE All-World UCITS ETF (code IE00B3RBWM25)
(not financial advice, do your own research).

Idea #2: Dividends from SCPI

As we like investing in real estate, but not the hustle that comes with it, then investing in a SCPI is a good option for us. Choosing the right one would be a matter of just a few hours or research. You can read more in our SCPI blog.

We expect from SCPI a dividend yield around 4% to 6% (before taxes) and the part value can increase or decrease over time. During 2023 their value in the market has decreased due to high interest rates. However, it could be a good entry point as it gets cheaper (not  financial advice, past performance do not imply future performance). 

myFrenchMoney tip

We are invested in Corum SCPI. We really like the company's opportunist approach buying properties at discount and with good quality long term tenants. Our preferred offer is Corum Origin and Corum Eurion. If you decide to select this company to invest in, you may want to use our referral code OWQV68 when subscribing (check our good deals page for more info).

Idea #3: Interests from lending money

Our last passive income idea is about lending money to companies (crowdlending, private debt)  or individuals (peer to peer) targeting an interest rate from 7% up to 12%. Individuals can lend to building constructors, companies looking for capital, green energy projects, or even other people. 

How to choose a lending platform? 

First thing to do will be spending some few hours selecting the right platform. It is very important to check if it is certified by ORIAS.  Then check the volume of projects, easiness to use, payback tracking, etc. 

Finally, you will need to select to whom you will lend the money (which project, etc.)…a bit of work, isn’t it? So that’s why we positioned this idea as number 3. 

Our experience

We lend money to building constructors through Raizers and Wiseed (referral link). For Raizers, you can subscribe using our referral code: ‘econtessigarcia-30087′. We have selected those companies based on our own criteria that may be different from yours. Learn more by reading our blog about Crowdfunding in France.

If you want to lend money to large companies (private debt), unfortunately it is not that easy to enter this market. We use Corum as well for this. They have 5 interesting funds. Have a look on the web site and if you decide to invest with them, you may subscribe using our referral code ‘OWQV68′.  

We do not lend money to individuals or peer2peer, but we know several people are happy with this kind of investment. A well known platform is ‘mintos‘.

Similar to peer2peer, we are not invested in green energy projects. But it seems the Lendosphere platform is a good one.

Other passive income alternatives

There are other passive income ideas to consider but with a medium effort: Vending machines, renting parking places or storage boxes, a social media account (influencer).  It is a matter of what you want to do and feel comfortable. 

We consider high effort ideas for passive income such as renting apartments (specially Airbnb), royalties, drop-shipping, blogs, etc. If you have the time, and passion on this kind of investment type, then go for it. Just be aware about the time and effort required.  

Key takeaways about passive income

We hope these 3 passive income ideas have inspired you to get your money working for you. It is a pleasant feeling earning money while you sleep.

Here are the key points to remember from this blog:

  • Passive income investments makes sense when looking for additional revenue;
  • For the long term, it might be better to invest in high grow assets instead;
  • Do not fall into high yield dividend trap;
  • Using french wrappers (like PEA, AV, PER) are important to optimize taxes.

Discover the ultimate guide to managing your money in France with our “Expat’s guidebook for personal finance in France” and unlock the secrets to thriving financially while living in France.

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Bon chance!


Please remember that we are not financial advisors. We are just sharing our best understanding based on our own experience. This blog is for educational purposes only. Do not make investment decisions solely based on what you read in this blog. What works for us, may not for you. Do your own research and look for professional service if required. Read our full disclaimer in the ‘about’ page.

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