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 reseller/referral associate programs.
Some referral or reseller associate programs (not related to MLM or network marketing), offer similar opportunities for earning residual income. Also called affiliate programs, these are very popular on the Internet.
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 referral/reseller 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
* You, as info-product creator, get 100% of the profit, versus a small percentage of royalties (around 10%) through traditional publishing companies, if they decide to publish it at all.
* By gaining complete control over the marketing of your information products, you can profit from them for as long as enough viable markets (willing, able and accessible buyers) exist.
Conversely, traditional publishers usually have so many new titles by other authors vying for their marketing budgets and attention that unless an author is well-known, or the work is a top seller, the author's work is not given much priority and is pulled from the market within year or two, thus fading into obscurity.
Last Words...
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, 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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