ISEGHE AJAYI
Depending solely on your monthly salary especially in this period of economic downturn cannot enhance your standard of living because before the end of the month, you would have exhausted everything such that there might be nothing left for you to save.
Besides, if you work in an organisation where salaries are delayed, survival becomes a major challenge as settling some household or immediate bills becomes a burden for you, a situation that leaves you with no other option than to resort to borrowing in order for you and your family to survive, pending when your take home is ready.
But, with proper planning and by engaging other sources of building your income known as ‘residual income’ you can surmount any financial challenge or difficulty.
Residual income is about using your clout to leverage the work you have already done, or work that others are doing on your behalf.
It is getting paid for work you have either done in the past, or contribute to indirectly and even if you stop working, the income keeps coming.
Nonetheless, have you ever pondered why the expression, “the rich get richer and the poor get poorer” seems so true, especially today? It is because the rich find and build sources of residual income.
Residual income is the main way that wealthy people make their money, and continue to “get richer,” at least in the long term.
Some examples of residual income are dividends, interest, gains made on financial investments, network marketing, where you enroll customers and recruit other representatives on which you earn commissions on total sales volume of your organisation each week/month/year.
They also include sales and royalties on a product or intellectual property that you have created such as books, music, or software application. You have done the work upfront (i.e. created the product), and are now getting payments for as long as sales are still active.
Online businesses such as membership sites or courses, where customers continue to pay frequently or sales occur via a computerised process and real estate, and most specifically residential or commercial real estate that generate rental/lease income.
The underlisted tips will help you to see the need to embrace residual Income:
Fund your retirement account and other investments.
Your retirement account and investment portfolio is indeed a source of residual income once you start sketching upon it.
This is the easiest to understand and perhaps the main way for most active income earners to generate residual income. However, for you to accomplish financial freedom solely from your retirement and investment accounts it takes a long time and it is subject to the volatility of the market.
Join a Network Marketing Company
Network marketing opportunities have a very low cost to join, generally, it provides products or services that are consumable and result in frequent payments from customers, and they allow you to leverage the team that you built by earning residual commissions on the sales of the people in your team. Be informed that building a network marketing team is hard work.
Write Books and Collect Royalties
Much like writing an eBook, there’s a lot of work upfront but once that is done, and the book goes into the sales stage, it becomes a completely passive venture.
This is especially true if you can sell the book to a publisher who would pay you royalties for the distribution and sale of the book.
You will get a percentage of each sale made, and if the book is fairly popular, the royalties could be substantial. Just as important, the royalties can continue flowing for many years.
You must be aware that, just because you create something, does not mean somebody will buy it as there can be a load of work that is necessary to generate sales.
Purchase Real Estate for Rental Income
Real estate is one of the longest standing, proven investments and purchasing it takes real money as it involves ongoing effort, typically requires significant holdings, and can be subject to the volatility of the market.
Rent Out Your Spare Room
If you do not have money for a rental, you can rent out a room in your house by looking for a quality tenant who you would be okay living with (a friend or family member would be ideal) and rent out your spare bedroom. This is one of the easiest ways to bring in some residual income.
Invest In Stock Market
Investing in the stock market opens up a wide area of opportunity and for easy investing. You could choose to invest in a couple of guide funds or if you like to pick investments yourself, you can hand pick a group of stocks.
Whether you invest in a personal investment account or a retirement account, you will still be making your money work for you.
The good thing about investing in the stock market is that it’s fairly easy to do. However you’ll have to put up a lot of your own money before you see any substantial benefits.
Set Up Website For Sale Of Product
If there is a product that you are principally well-informed about, you may be able to sell it on a dedicated website.
The technique is similar to what you would use for your own product, except that you will not be concerning yourself with product creation, but only with the sale of someone else’s product.
You may even find after a while that you are able to supplement other products that are connected and if that happens, the site could generate substantial revenues.
If you are able to have the product conveyed to customers directly from the manufacturer, you will make more money.
Become A Business Silent Partner
You can become an investor to a successful small business owner that needs financial assistance by providing the needed capital.
Instead of offering a loan to the business owner, you can treat this as a business opportunity and take an equity position in the business.
In this way, the business owner will handle the day-to-day operations, while you will act as a silent partner who also participates in the profits of the business.
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