Definition: A residual income stream will earn you money even when you’re not on the clock. Owning rental units, collecting royalties or investing in a savings and investment program are examples of such passive income. (additional link below for a residual income option)
Residual Income: What Is it and How Does It Work?
Wouldn’t it be nice to earn money while not working? That money is called residual, or recurring, income. It’s what can happen after you put a lot of time, effort and sometimes money into a job to continue to get paid for the work months or years after it’s done. (Salary jobs are part of linear income. This income is directly related to the number of hours you work. If you work 40 hours, you get paid for 40 hours of work.) Once you set up your business to earn residual income, you continue to make money while doing other things – maybe even starting a new business to generate more residual income!
Types of Residual Income
- Royalties, Subscriptions, advertisements, donations or affiliate links from your blog or website
- Transferring the rights to a song you recorded, a book you wrote, a software program you created or a gadget you invented to a company agreeing to pay you a percentage of each copy of your work sold
- Purchasing an office or apartment building and leasing or renting out the properties
(a “work from home” option is listed at the end of this article)
Does the Money Just Keep Rolling In?
The ideal residual income stream will produce money 24 hours a day, 7 days a week and you don’t have to personally market or interact with the business in any way. All you have to do is watch your bank account grow.
Advantages to Residual Income
- You do have the potential to be financially independent if your residual income produces enough money.
- Having residual income allows you to do more important things with your time.
- No matter what, you will have a constant flow of income (however large or small it may be). This is critical if you get injured or sick.
- You will make money no matter where you live, unlike a linear income which ties you down to your position.
Of course, before the money starts rolling in you will probably have to put a lot of time and effort. Instant gratification is not possible when it comes to residual income.
To learn about a cutting edge business in the energy sector that you can work part time to build a residual income for your future Click This Link Residual Income Link
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