What does residual income mean and why is it better to have it?

Residual income is a dream of every normal person, when your income does not depend on whether you are working or not. Passive income is not only a dream but also a salvation.

Passive income

If you look at the life of today's retirees, you involuntarily start thinking about yourself. So, the life of the majority of grandparents and parents is simple. Roughly speaking the income of most people in the world depends on working-hours.

Sometimes it will happen that you are retired but there will be such circumstances that you won’t have the possibility to get up early in the morning and go to the office, the shop, the factory, to work. In such case people simply do not receive a salary. But on the other hand, many seniors have a passive income and their life due to this is bright and not boring. What is better?

For somebody passive income is the main source of income and it gives them the opportunity to develop in different ways of life, while other people get up at 5 am and go to work.

Passive income

Firstly, it’s necessary to define what is passive income? It is an income that does not depend on daily activities. It is an integral and fundamental part of financial independence.  

Passive income is formed, even when you are not working. Imagine what your life would be if you do not have to work and you still have the income! But in order to get a passive income, it takes time and a lot of work, physical and intellectual.

After all, the whole point is that once you should work hard, and then relax and receive the benefits of your activities for the whole life.

READ ALSO: What are the best jobs allowing to work from home?

Passive income

Let’s point out the strategies of Passive Income

Option 1. The most simple and accessible to everyone - it is a deposit in the bank. You put your money at the interest rate, and after a while, you can relax. One important point that should be stressed - you need to put in the bank at least a few millions in order to have a needed sum.

Option 2. Recurring royalties. If you have written a book, tutorial, created a program ... or you are an author of the product, which may be your passive income. But you need to be really successful. There are quite many examples when an artist during all his life is fed by one album or single, or a book.

Option 3. For many young people there is a hobby to have a website on the internet which can turn into a good passive income. Having a popular website, a few people in the state, who will fill the site content and develop it, you can make good money on advertising. To realize this passive income you must work hard and organize things well, so that it could be continued without the direct and constant participation of the owner.

Passive income

Option 4. Rent. You can rent out an apartment, a garage, a large building for offices or warehouse. As a result, you will own the asset as a property and have passive income. To have this property, firstly, you must earn it or luck plays its part - you will get it from your parents or relatives.

Option 5. Investments. It is the most common way to generate passive income. The investment is a direct source of passive income. Investing in something, you immediately start to make a profit without your participation. In order to have sufficient income, so it is necessary to have sufficient start-up capital and little understanding of the form of investments where you invest.

It can’t but should be mentioned – everyone, who would like to be engaged in this sphere, has to read books, written by Robert Kiyosaki.

The most important thing you should know is that passive income - the key to your future, and peace of your mind. Indeed, when a person starts to earn a lot, despite the pace of life, he becomes calm. This is reflected in the fact that people are not worried about tomorrow, their life will not be deteriorated if they do not work hard.

Passive income

Passive income will give you not only material goods but also time, that is very important. No matter which option you choose for yourself, because everyone finds something of his own, it is important to understand how much of passive income will be enough for your life. Many people know this, they know what is passive income, but do not have it and take it for granted, not taking advantage of the desire to have it.

As long as we have a stable job and we are young, life itself does not allow us to think that we soon will be 40 and we will have no desire to work hard. We are not talking that at the age of forty it is too late, but it would be better to think about it now, because tomorrow probably you will have no choice, except working hard to feed your family.

Finally, there is an instructive cartoon about Pablo and Bruno. The paradigm of thinking is incredibly difficult to change, because we used to base on previous experience! The story of Bruno and Pablo shows us how the majority of people live today. This stunning cartoon will help you understand which direction we need to move in order to succeed in our life. After watching the movie, you can decide for yourself who you are at this moment: Pablo or Bruno.


If you want some more detailed information on actual strategies and methods you can use to generate a passive income from scratch (without requiring capital to invest), see this article from passively.io: http://passively.io/12-passive-income-ideas/

Answered 1 year ago.

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Answered 1 year ago.
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