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Looking to build a life-changing second income? For me, the best way to chase a strong and sustained income — and one that requires considerably less effort than most popular side hustles — is to invest in the stock market.
Last year, the FTSE 100 delivered an enormous 25% total return to investors. For the S&P 500 index of US shares, the figure was 18%. Those buying stocks at the start of 2025 could have supercharged their portfolios, then, boosting their chances of eventually enjoying a large passive income.
Returns were larger than usual, sure. But even at typical rates, a small investment can generate considerable wealth over time. The FTSE All-World Index of large- and mid-cap shares has delivered an average annual return of roughly 12% over the last five years.
Here’s how investing just £100 in global stocks could eventually produce a £23,455 second income with minimal effort.
Generating wealth
One of the simplest ways to invest in stocks is with an index tracker fund. They allow individuals to own a slice of many different companies, spreading risk and providing exposure to a broad selection of growth and income opportunities. And all at relatively little cost, too.
The Vanguard FTSE All-World ETF, for instance, tracks the performance of 3,657 stocks across regions and industries. And it has an ongoing charge of just 0.19%. If it can continue delivering the 12% annual return of recent years, a £100 monthly investment over 30 years will eventually turn into £335,074.
If then invested in 7%-yielding dividend stocks, a portfolio of this size would generate a £23,455 passive income a year.
Buying single stocks
Rather than gaining broad stock market exposure with a fund, investors can also choose to invest directly in companies. This requires a lot more effort than simply sticking your cash in an index tracker. However, it can also lead to far better results.
I think a portfolio of 15-20 stocks offers excellent diversification to spread risk and aim for big returns. Games Workshop (LSE:GAW) is one of the FTSE 100’s finest growth stocks I’ve bought for my own portfolio.
Thanks to its leading role in a rapidly growing market, the tabletop gaming specialist continues to enjoy booming profits even as the broader retail sector struggles. Last year it delivered a total return of 47%, smashing the broader FTSE index’s performance.
Further price gains in 2026 mean the average annual return over the last decade is 45%. If you’d drip fed £100 each month into Games Workshop shares since then, you’d now be sitting on a cool £218,409 (assuming dividends were reinvested).
Can Games Workshop keep rising?
Past performance isn’t always a reliable guide to future returns for any share. In the case of Games Workshop, returns could be impacted by rising competition that dampens sales and margins. It may also face rising cost pressures (including tariff-related expenses).
However, I’m confident the Warhammer manufacturer can keep outperforming. The fantasy gaming market has considerable scope for growth, and Games Workshop is expanding to capitalise on this. Media deals like the one with Amazon to create film, TV, and video games content might also supercharge licensing revenues and boost sales of its miniatures and boxed games.
