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SpinDistribute.com Article Directory

The following article was published in our article directory on April 28, 2014.
Learn more about SpinDistribute Article Distribution System.

The ABCs of Residual Income

Article Category: Marketing

Author Name: Colin Burnett

Unexpected events in life can leave you financially incapacitated, which can last for weeks or even longer. Insurance policies can help you manage these unexpected events such as natural disasters, health emergencies, unemployment, and death of a family member, but what if you are left unsecured? How will you able to bounce back from these misfortunes? Even claiming your insurance and getting your income from your day job may not suffice in worst cases. That is when residual income, more commonly referred to as passive income, becomes beneficial. However, there's more to passive income than a substitute income in emergency situations.

Linear Income versus residual income

Regular jobs are sources of linear income. In this type of income, the amount you will get is based on the number of hours you worked and your rate per hour of work. Jobs that offer this income are often factory-based and office-based. Teachers and nurses also receive linear income. Unfortunately, experts say that recipients of linear income alone are less likely to become financially independent. A few will succeed, though it will take them many years to earn much. Still, more than 80% of the population earns this type of income.

Residual income, in contrast, may come from various sources. Dubbed as passive income, the name implies that you can earn it even if you are not actively engaging with the job. Aside from that, you can generate this income even after months or years. That is why some refers to this as recurring income. Imagine getting paid for a single work for how many times. That's how this type of income works.

Advantages

Basically, residual income can help you handle emergency situations. But the thing that draws a lot of professionals to get this income is the flexibility of time. The last thing that they want is to have another job to give them headaches and consume much of their time.

Another good thing about passive income is that you can earn from doing something that you are passionate about. There are sources of residual income that appear too technical as well. The World Wide Web will be your friend in understanding these complex sources.

Ways to Get Passive Income

Artists are the best examples of people who receive residual income. Take songwriters and authors as examples. Songwriters get paid each time their songs are used in commercials and concerts. Authors earn from each book sold. These types of income are called royalties. If you have talent in songwriting or writing about anything, you can earn these royalties.

Investing in stocks and having a savings account are also ways to get passive income. In savings, you will get the interest generated depending on your account type, duration, and amount of deposit. Aside from stocks and savings, you can also invest in bonds and mutual funds.

The Internet also opens doors for people looking residual income. You can set up a blog and get paid for each advertisement featured in your blog. The good thing about this is that you can work anytime and anywhere. You don't need to sacrifice your regular job just to focus on this one. You can even start without any money at all. You just need to have your own computer, a reliable Internet connection, and the drive to do well .

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