For most people, the amount of money that they can make is mostly dependent on how much they work.
However, since there are only so many hours that a person can work per day or week, their earning ability is limited.
This is why residual income can be so valuable.
It is often regarded as the main difference between wealthy people and those who are less fortunate, and the reason why some people are able to amass fortunes.
But what is residual income? And what are some of the best residual income opportunities?
Let’s explore below.
What is Residual Income?
In essence, residual income is the process of continually receiving money long after you have completed a task or job.
Good examples of residual income jobs include book or screenwriters, musicians that sell their music albums, or investors that get dividends from their investment.
For instance, if a person sells a part of the company but maintains control of its shares, they will receive easy residual income even though they may no longer have anything to do with running the business or making decisions.
You can look at residual income as an asset – something that was once created and still makes money for a long time after your involvement is finished.
How Is It Different from Active Income and Passive Income?
Although residual income may sound like something that doesn’t require any effort at all, that’s not actually the case – it merely means that the work that is put in gets rewarded continually after it has been finished, and not just once.
That’s the primary difference between residual and active income – with active income, you get paid for the work that you complete and then have to continue working to receive further compensation for your efforts.
Meanwhile, if you are able to find the best residual income opportunities, you can receive continuous monetary rewards, sometimes for many years.
Now, as far as passive income goes, that is a term that is often used interchangeably with residual income. However, technically, the latter describes the discretionary money that is left available after all obligations have been paid.
The Benefits of Residual Income
Residual income offers a range of benefits, which is why people are always looking for opportunities or jobs with residual income potential.
For one thing, residual income allows you to spend less time working and more time enjoying life – if you have a stable income that you can rely on, you can spend your time pursuing the things that you enjoy the most.
In fact, many people that have found that residual income opportunities allow them to spend their time helping others through charities or volunteering, pursuing their passions and hobbies, or spending more time with their families.
Bone Fide Wealth
Finding ways to build a portfolio of residual income sources should be the goal of everyone – it’s the only way to protect yourself and your family against unexpected events and make sure you live a comfortable life.
If you want help with getting started with planning your financial future, the NYC financial advisor team at Bone Fide Wealth can help. Call us at 212-390-1161 or fill out our contact form, and we’ll guide you through the entire process.