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There are tons of articles out there confusing passive income with residual income. But in the financial world, residual income has an entirely different meaning. Also known as disposable income, residual income isnt really a sort of income, its a calculation that accountants perform to determine what your income is after paying all expenses and debts.
If youre reading this guide, then youre probably curious about passive incomeand the way to earn it. There are numerous ways to earn passive income, including from:
Stock returns: Dividends you receive paid from any stocks you own, which earn you money long after their purchase.
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Investment properties: Rent you get from a real estate propertyresidential or business. Yes, the house needs to be maintained, however, the earnings still flow in every month.
Book sales: Royalties an author receives writing a novel. Generally, they have paid a percentage of their retail or net price of every book soldin perpetuity.
In all of these cases, your one-time investment consistently provides you with an income while you sit back and collect on it. What could be better than that!
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In the entrepreneurial world, another popular type of passive income is click-to-purchase content, which includes products such as e-books, how-to guides, or online courses. Essentially, the entrepreneur sells his/her expertise through these pre-prepared online productsindividuals purchase the e-book or online training to gain entry to the experts knowledge.
Since the entrepreneur has prepared the content, all they need to do is watch the money roll in (obviously, only after theyve gained a following and promoted the hell out of these )!
In the electronic era, knowledge is powerand money. Selling your knowledge through online products is big business. Why not tap into it
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Of course, the selling of manufactured products or products is an age-old source of income, but can it be passive income it might be, depending on the business model. Two of the most common sources of passive income through merchandise sales are:
Product Distribution: Companies that enable individuals to become product vendors and earn a return on their clients purchases are another source of passive income. As with any other sort of passive income, if you invest up-front (by recruiting loyal clients ), the long-term benefits can be huge!
Affiliate Programs: As an affiliate, you market a companys products or services on your site, and you get a recommended you read percentage of their sale when someone clicks from your site to purchase it. If your site gets lots of traffic, you can earn a pretty penny from affiliate links!
That is exactly what dreams are made of. Youre making money even when you arent doing anything. This means that even if youre sick, traveling, or dont feel like working, the money youre your passive income source(s) continues to roll in.
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The thing about earning money from your corporate occupation is, no matter how hard you work, no matter how fantastic you are at your job, no matter how much extra time you log, then there will always be a limitation to your incomethats the word salary limit exists.
Unlike your company salary, passive income has no limitations. Want to earn seven figures Then start investing!
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You can work your butt off to make money but youll never get anywhere until you start making passive income. I make money on seven different income sources but some of them require a good deal of work.
Passive income is money you earn from a solution or an investment where you dont need to do any more work after you put it up. That means consistent cash flow each month whether youre working or not.
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Im going to share my seven popular passive income resources, income flows I use to create money every month. Now Im not going to sugar coat this, a few of these are going to take work but may mean thousands a month you can count on.
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Im going to start with the easy passive income thoughts, the ones which you can begin making money on immediately and will operate through to the ones youll create the maximum money on as we go through the list so be sure to stick around to catch those last couple of passive income strategies.