What are the best residual income opportunities? First off let’s take a look at the meaning of this word ‘residual’. It can refer to the ‘left over money’ which you have once you have paid all of your outgoings for the month.
It can also refer to an ‘ongoing’ income for either work done previously, or from investments. In this instance I am referring to ‘residual’ income as money which still comes in even without doing anything. Residual income is the best kind of income. It’s ‘passive’. And there’s a few ways to generate this kind of income.
Best Residual Income Opportunities
So what are the best residual income opportunities? Depending on your particular circumstances, you may choose different residual income opportunities. For example, having a property which brings in money every month from renting it out, can be considered a ‘passive’ income of sorts, depending on your mortgage rates.
Owning shares in a company can also bring in passive ‘residual’ income in the form of profits and dividend payments. But you need money to build these kinds of investments. What do you do if you don’t have the captial needed to buy property or invest in shares? (See alternative income streams ideas)
Linear Income Vs. Residual Income
Linear income is what 90% of the world do to make money. Linear income is trading time for money. Most people see income as being earned by going to work. Even the top paid professions still trade time for money. When they stop working their income stops too.
Residual income keeps on going, even when you stop working. With residual income you do the work once and you continue to earn from it. Actors, authors, film directors and producers continue to earn money from their previous work. Bill Gates continues to earn money from Microsoft, even though he doesn’t have to continue working. But what if you’re not an actor, author or inventor!? What are the best residual income opportunities for anyone?
Best Residual (Passive) Income Opportunities
So there’s a few passive (residual) income opportunities available. Let’s look at each one in turn and at the end of this article I am going to share what I consider the best residual income opportunities which anyone can do. Feel free to skip to the end if this is you.
Residual Income From Property
Property ownership (real estate if you’re in the US) is a great way to earn a passive income. However, you need to acquire the proerty first. You can do this with a mortgage or even a buy to let mortgage. Some property owners buy properties knowing they will never pay off the mortgage.
They use their mortgage to acquire a property and then rent out that property. Provided they can earn more from their tenants than they are paying in mortgage payments, they are in profit. An interest only mortgage, for example can allow someone to purchase a property and only pay the minimum monthly payments. They may never actually own the property outright, but they can still make a monthly profit. If they get a regular tenant and pay someone to do the groundwork, maintanence and renting, they are effectively earning a passive income. They still need to keep up the maintanence of the buildings they rent out of course.
Many property owners do this multiple times, acquiring one property after another. As each one is filled with a suitable person they are getting rent payments every month.
Earning From Property Appreciation
Property owner also can earn money ‘passively’ even when they break even on their rent. If they build a larger stake in the property and the value of the house goes up, the appreciation of the house means they gain capital. Their tenant’s rent needs only to cover their mortgage payments each month. This is a much slower way to generate income through growth of your investment. It doesn’t produce any cash flow however but can still be considered passive because you are growing the cash value of your house over time.
How you earn from renting property depends on your ability to get a mortgage and get the right tenants in your property. Whenever your property sits empty you are losing money.
Royalty payments are paid to people like actors and authors. An author who is successful can earn continually from publishing just one book. However, there are also many unsuccessful authors. You can self publish books now on Amazon and many people are using this platform to give away free ‘ebooks’ to grow their online presence. See one of my ebooks here on Amazon. You can self publish a book on Amazon here and sell your books globally.
Even if you make a tiny commission on each book you write, with a global audience and the right niche, you could make a nice extra income if you have a passion or interest to write about.
Actors too get royalty payments for their work. As they grow in popularity they can charge more per job they do. Top Hollywood actors also negotiate a profit share of the films they do. Sometimes they even lower their fees in exchange for a profit of a film.
Earning From Investing
Shares and investments are another way to earn a residual income. However, again you still need capital to buy shares and invest. Unless you have the money in the first place, it’s very difficult to earn a residual income from shares and investments. If you don’t know anything about shares and investing a great little app is the money box which allows you to connect the app to your bank and pay small amounts into your share portfolio.
Of course this is a long term investment plan. You only earn from this over time and after you have put a lot of money into various shares and investments.
Best Residual Income Opportunities – Online Marketing
Online ‘affiliate’ marketing is a kind of referal based marketing strategy. Let’s use an analogy to demonstrate. Let’s say you go out to a nice restaurant and your friend Bob just popped round for a coffee.
“What you been up to?” – asks Bob!
“We just went out to this restaurant” – you reply!
“Fantastic!” and you go into detail about what a great place it is.
The next week Bob pays it a visit and takes his family there, all because you recomended it. Well, affiliate marketing works much the same only you can earn commissions for your recommendations. By recommending products and services around the internet, you earn commissions based on their sales.
But how does this relate to the title “Best Residual Income Opportunities”. Hang on I’m getting to that! Let’s start with how you make these recomendations on the internet.
Starting A Blog
You don’t have to be a blogger to earn affilaite commissions. However, it’s a nice easy example to start with and many affiliate marketers start off by blogging. As a blogger you can write about anything but let’s say you write a review about a new TV you just bought. On your blog you link through to a store which sells the same television. Just before someone makes a decision to buy a TV like the one you are reviewing, they find your blog. They read your review and go on to buy so you receive a commission on that sale which you referred.
However, this is where affilaite marketing gets more exciting. Your review is still there and more customers can continue to find your blog and use your affilaite link to buy the television. Each time someone buys through your article, you get paid. This is how affilaite marketing can earn residual income. By writing multiple articles which bring people through your blog and on to products and services around the web, you continue to earn money for work you have done previously.
What’s great about affilaite marketing is that anyone can do it. It’s also much cheaper to start than many of the other best residual income opportunities.
The affiliate marketing model isn’t limited to blogging either. If you don’t want to blog that’s ok. You can simply send people (website traffic) directly to offers and products online. Online advertising can be scaled up too, which means if you choose the right affilaite products you can sell to a global audience.
The automation of an online business means you can scale up with tools, systems and strategies. Not only have you got a system which can pay you over and over from a single piece of content, but you can also scale up with paid online advertising.
Residual Income From Online Sales
So, affiliate marketing is one of the best residual income opportunities for a few reasons:
- You can create content which connects people directly to products
- You can scale up with paid advertising
- You can reach a global audience
- You can use ‘leverage’ with online tools and systems which work for you
But another way affilaite marketing can earn residual income is through subscription products. Affiliate marketing is a sales model which allows anyone to promote other people’s products and services on the internet. By choosing products which have subscriptions (memberships) you can earn again and again from a single sale.
Monthly Commissions & Up-sells
Not all affiliate products are equal. See my article on the most profitable affiliate marketing programs. As already mentioned you can earn more by promoting products which have a monthly commission. Choosing products like this means you can earn every month for the lifetime of your customer. This is far better than only earning a commission for a single sale. Monthly commissions are a form of residual income. Providing your customer remains in your membership program, you will continue to earn commissions.
Up-sells are another form of residual income which you can earn from affiliate marketing. Again, not all programs offer this so make sure you do your research before choosing a product to promote. Monthly commissions and a range of up-sells offer the best residual income opportunities from affilaite marketing. For many affilaite products you only earn for a single sale – any later sales closed by the company don’t earn you any further commissions. By choosing affiliate products which offer subscriptions and up-sell commissions you increase your potential earnings through residual sales.
Built In Sales Team
Choosing an affiliate program which not only has subscription products you can sell, but also offers up-sells with a built in sales team, gives you more opportunity to make later residual sales. Even if you only refer the customer through the initial sales process, you are still rewarded for later sales made by the company itself. As long as you were the initial referrer of the customer, you can make monthly commissions and earn on later sales as long as the customer remains an active member.
Does This Interest You?
Being an affilaite marketer in many ways is about generating traffic and building a value. By offering value and genuinely helping people with their problems you can offer products and services as solutions. Review sites, for example, help people decide which products are best for them. Affilaites typically spend their time creating useful content. Activities like blogging or creating video are two main strategies which affilaites use to gain traffic and make online sales.
A couple of the main reasons why peeople become affilaites is due to the potential to earn residual income, and the ability to leverage the internet and scale up. You can’t scale your time, no matter how hard you work and how much you get paid per hour. With an online business you can ‘leverage’ your time by selling digital (and physcial) products worldwide. You can scale up too and earn residual income from work done previously.
Income doesn’t however come before work. But with the internet and the right affilaite business model, your potential to earn is much more than by solely trading your time for money.
If you’re interested in starting your own internet based business checkout this video series to learn more and get started.