Would you like to make money even while you sleep? Wouldn’t it be nice we continued to earn money even if we were watching TV?
What is Residual Income?
Residual income is income that you earn even when you don’t work. Your salary pays you an income that is proportion to the number of hours and effort that you invest. Once you stop working, your company will cease to pay a salary. This sort of ‘one-shot’ income is referred to as ‘linear income’.
Residual income, on the other hand, will continue to be generated even when you spend your time on other things. In the preliminary stages, you may have to expend some effort, time and energy into setting up a residual income stream. But once that effort is invested, the income will begin to get generated on its own.
Ideally, a residual income should be able to regenerate itself 24 x 7, the reality is somewhat different. You must monitor your residual income every now and then to make sure that you have your best to ensure a better flow of income.
For example, if you have chosen to invest your money in stocks, communicate with your financial advisor. Find out if you can diversify your investment portfolio. Once you have done this, you need not be directly involved. The investment will yield its own returns.
The best part about residual income is that you can look forward to achieving early financial independence. It also gives you confidence to change your job or career line if you want to.
There are several ways to earn a residual income.
How do you earn a residual income?
It’s possible to generate a residual income in the following ways:
- In the form of royalties from patented literary works or products
- Money generated from blogs in the form of affiliate links and advertising
- Renting out space to domestic or commercial clients
- Investing your money in stocks, bonds, ETFs
- Residual income from sale of photographs
The good news about residual income is that you have the option of developing multiple streams. For example, you can invest your money as well as earn money from affiliate links in your blogs. There is no limit to the number of ways in which you can earn money.
Residual income is earned even while you sleep; there is no requirement for constant, 24 x 7 involvement in the process.