What Is Residual Income? Is It Better Than Traditional Income?
“Profits are better than wages. Wages will make you a living, profits make you a fortune. It’s difficult to get rich on wages, but anybody can get rich on profits” – Jim Rohn
I have had many people ask me when talking to them about my business – what is residual income? Is it better than traditional income? In this article I will go through the differences and you can then decide whether residual income is better than traditional income.
So I have a question for you – How much do you get paid if you stop working? If you’re like most people, your answer is probably “nothing”. For most, if not all wealthy people, the answer is very different. The vast majority of wealthy people have learned how to make money when they’re not working, when they are taking a break for a few days or weeks and even when they’re sleeping.
The type of income that enables you to earn while you are asleep or when you are on a break from working is called “Residual Income”.
In simple terms, residual income is money that keeps getting paid to you month after month, whether you work or not. You earn money no matter what you’re doing, because you have done a good job ONCE. If you were to develop yourself a residual income of, say 2000 a month in whatever currency you have in your country, then you would earn that 2000 every month WITHOUT doing any more work. You could go to the shops, go to the swimming pool, play golf every day if you wanted to and you would still be paid the same.
This is the kind of income that is earned by successful network marketers generally and lots have become wealthy. By leveraging others’ efforts and teaching them to do the same as they have done their residual income can increase even though they do nothing.
A good example of this was a person I know who had run his business successfully for 4 to 5 years decided to take a long break from work. In fact he took early retirement in his 30’s. He started to work his business again after 5 years and his income had doubled! (Sorry, I can’t disclose who he is by name because I don’t have his permission)
The wealthy people who have built their businesses in this way are earning money 24/7 and you can too.
Most of the time, the only residual income most people will ever earn is the measly interest on their savings account with their bank. Imagine what it would be like if your residual income was large enough for you to quit your job, or even quit working altogether…
So you have just got yourself a new job at the local store. Your new boss has told you the rate of pay, whether there is any overtime and how many hours you will do each week and when. They will likely tell you whether you will get paid weekly, 2 weekly or monthly however THEIR system works.
What happens when you go home? Your income for that day stops. It’s hard to make a decent living and get financial freedom when you work this way because you are governed by others and the system they tell you to work. Also because you have a limited amount of hours each day to work and generate income, you will have a fixed income unless you work more hours. Similarly, if you don’t turn up to work one day due to illness or something unavoidable, you won’t earn any money.
Why do most people choose this as their main method of earning money? Simply because they don’t
When you develop a business that pays you a residual income you will earn the money day in, day out whether you are working or not. It depends on the system of residual income as there are a couple. There is a one tier type residual income, an example is where you earn money from those who directly buy a membership to a training facility to which you are affiliated and as long as they are a member you get recurring commission. Then there is the residual you can get from a network marketing opportunity, which is more than one level and is more leveraged because you earn from those who you signed up directly and then a further commission from those they have signed up.
Working consistently to build your team will help your income to grow. When your direct referrals build their team your income grows more and you have only taught your direct referrals how to do what you did and they then do the same. Can you see the power of the system?
The power is more evident when you go away for a week and when you come home you have had a pay rise and you were fishing or doing something you really enjoy. Cool eh?
Do you think your boss would keep on paying you every month if you didn’t turn up? You would more likely lose your job. With your own business and your new residual income, you are in complete control, and nobody is allowed to say how much you are allowed to earn and when you can earn it. You could start working on your Residual Income today!
Don’t let ANYONE tell you how much you’re worth.
To the future,