How Do You Define Residual Income?
If you are looking for a way to define residual income, you will find a few options available. In some ways, it depends on your perspective and background, but I think it is important to understand what residual income is and, more importantly, understand how to get it.
If you know me, at all, you will know which option I prefer when I define residual income. Which definition works best for you?
Investopedia says: Residual income is the amount of income that an individual has after all personal debts and expenses, including a mortgage, have been paid. This calculation is usually made on a monthly basis, after the monthly debts are paid.
Lifehack says: Residual income is when you continue to get paid after the work is done. This includes royalties from books, movies, or songs and also income that comes from real estate or business investments where you don’t actually have to be present to earn it. For example, Bill Gates is still making a residual income from Microsoft even though he isn’t working there anymore.
That second one is my preferred way to define residual income. The idea of continuing to get paid long after the work is done is pretty appealing. Most of us spend our days trading our time for dollars. We get paid an annual salary or an hourly wage. We might be a contract worker meaning we get paid by the task when it’s completed.
The amount of money you are getting paid really doesn’t affect the definition. There are many people who get paid very large amounts of money. For example, the CEO of a company, a professional athlete, or a movie star ca be paid very well. Even though the amount of income is very high, the potential is limited because no matter how much money you get paid you still need to show up to work to earn your money.
This is what makes residual income so appealing to people looking in to network marketing. The potential to get paid for years after the initial work is done is pretty exciting. Personally, when my wife became ill, I was very grateful for the residual income stream I had built. The freedom allowed me to take her to doctor visits and tend to her as needed without me having to worry about whether I would get a pay check.
Maybe your search brought you here because you wanted to look more in to residual income. On this site, you will see a number of ads offering you the opportunity to create this type of income for yourself with a home based business.
We encourage you to click on the ads that interest you and feel free to ask questions of the advertiser.
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