“Residual Income” is a term often thrown around by Entrepreneurs and financial type people along with phrases like “building wealth” and “time freedom”. But what exactly is Residual Income? And how can everyday people get a hold of it?
To start with I’m going to define the type of income we are all most familiar with – Linear Income. Linear income is where work is done once and money is paid relative to that one effort. For example:
- Traditional job – payment is for the number of hours worked, or
- Selling products or services – Money in exchange for that one product
The definition of Residual Income (also called “passive income”) is money that is received on a regular basis with little effort invested to maintain it. Another way to think of it is you do work once and you get paid for that work again and again and again.
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