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Why Residual Income Is Smart Money - And Ways You Can Earn It
by Marty Foley
Residual income (also called passive, or recurring income) is income that continues to be generated after the initial effort has been expended. Compare this to what most people focus on earning: linear income, which is "one-shot" compensation or payment in the form of a fee, wage, commission or salary.
Linear income is directly proportional to the number of hours invested in it (40 hrs. of pay for 40 hrs. of work), but one of the great advantages of residual income is that once things are set in motion, you continue making money from your initial efforts, while gaining time to devote to other things... such as generating more streams of residual income!
There are a variety of ways residual income can be earned. Following are some examples.
1) Transfer the rights to a book you wrote, a software program you created, a gadget you invented, or a song you recorded, to a company that agrees to pay you a percentage of each copy of your work sold in the future.
2) Become an actor and draw residual income from each of your movies, TV shows, or commercials, each time they run.
3) Let an oil company drill a well on your property in exchange for a percentage of the revenue.
4) Purchase an office building or other real estate that earns you recurring income through lease or rental payments.
The above ways of earning residual income generally aren't that easy to implement. Following are some that are more attainable for the average person:
5) Start a savings and investment program that pays you residual income in the form of interest or dividends.
6) Join associate programs.
Call them what you will: referral, reseller, affiliate, bounty or associate programs, they are very popular on the Internet. Some of them offer similar opportunities for earning residual income.
Companies arrange such programs to compensate reps, resellers, dealers, associates, affiliates (or whatever the designation used) for promoting their products and services.
Reps are generally given a unique I.D. number and/or web page or site, so the company can track the source of each sale and compensate the proper rep.
Keep in mind that many associate programs only pay one-shot commissions, rather than recurring, residual compensation for your efforts.
7) Create and market your own information products.
Self-publishing your own information products has several advantages over marketing through other publishing companies:
The best types of residual income are usually those that you have exclusive rights to or otherwise control. They may be harder and more time-consuming to develop or acquire as opposed to promoting products and services of other suppliers, but the rewards are usually greater, and the income more stable.
I'm not against earning some good, honest, "one-shot" linear income, but given a choice, which would you rather do: work hard and get paid only once, through linear income, or get paid continuously - perhaps for years or even the rest of your life - for hard work you perform only once, through residual income?
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Tags: Money Matters