A Little Background about Residual Income
Residual income, also known as passive income, allows you to generate income 24/7 by doing something once and getting paid off of that initial effort for as long as you have the customer and they are paying for the product and/or service. You can get paid on a monthly, bi-monthly, quarterly or even annual basis. Most companies offer a way for people to market the product or service via a website. This allows you to operate your business 24/7 without the limitations of a traditional business.
Residual Income is different from Linear Income. Linear income is typically made when you work for someone else on a job. You typically get raises and bonuses, if applicable, based on your performance. A person is typically required to work in a specific location in order to earn that salary. In some cases, companies allow employees to work remotely, instead of working from a company’s location. If, for whatever reason, you stop working, then you will stop getting paid.
By definition, residual income is money that you earn based on previously-done work. An example that is often used to illustrate residual income is the writing of a book. The writer receives royalties (payments for each book sold) long after the book was written and published. There was an initial effort to write the book and get it published. After that, however, the writer receives income based on the sales of the book, and this can last for an indefinite period of time.
How can you Benefit from residual income?
Benefit #1—Continual source of income—after you have established a customer base, you will reap the benefit of the passive income for as long as the product/service is being purchased. The more customers that are acquired, the more your residual income will increase. The beauty is that there is no limit to the amount of income that you can make.
Benefit #2—Once you set up the business, you do not have to exert the same kind of energy that was required to initially set up the business. That is why some call it passive income, because it will continue to “stack up” over time. It does not require additional “sweat equity” after the initial development period. Also, residual income can come from more than one stream. Imagine a tiny creek that flows into a stream, which flows into a river. The more creeks flowing into the stream causes the stream to become even larger. A larger stream results in a more powerful river. Passive income will continue to increase as you continually acquire more customers. You do not have to hover over the business like a “clucking” mother hen, but can move into other arenas. The initial business will continue to progress and expand.
Benefit #3—Because it is your business—that is, you do not work for another person—you make final determinations about everything. You determine your working hours; you determine your level of effort; you determine whether you want to expand your business. It is all in your hands. You will determine the amount of money you make on a daily, weekly, and monthly basis. Although that can sound scary to some, the good thing is there is no one standing over you requiring you to work eighty-hour weeks or twenty-hour days.
Benefit #4 – Passive income can increase work and family balance. Work life balance does not exist in Corporate America. On the other hand, once you build a respectable passive income, you will start to not only experience increased income, but you will be able to do this working less hours. People that are serious about getting their time back, work really hard initially to build momentum in their business. This allows them to spend more time doing things that are most important to them — spending time with family and/or friends, traveling, volunteering, etc.
Benefit #5 – You do not have to be in one location to earn residual income. You can work your business from any place in the world. If you have a phone, a computer, and an internet connection, in this industry you can work your business. Do you think your current boss would allow you to work on the beaches of your favorite island for weeks at a time? You don't have to think about that. If you do, then I can answer for you… They will not! The only way you will be able to do that if YOU were the boss.
Residual Income Leaves the Control in your hands.
In Corporate America, if you are not the employer, then you are the employee—your role does not include major decision-making. Employees report to their employer and are at that person’s mercy. The employer (not the employee) sets the goals; the employer (not the employee) outlines the business plan; the employer (not the employee) monitors the work of the employees. The employee has little control over these decisions. There are, of course, exceptions to this operational model. The overriding principle is that the leader of the business is in control of the vision and the achievement of that vision.
With the concept of residual income, however, it is the leader’s job to build the business. The vision for the business is in your hands. If you build your business right, then strong, residual income will be the result. It is up to you to get the business. As you exercise this control, you are literally making decisions that will determine the success of your business. The amount of passive income will depend, in large part, on the number of customers you acquire. If you are conscientious and dedicated to your vision, there is no limit to how much residual income you will be able to accumulate. Remember: you control the success of the business. Making residual income.. it is all in your hands!