What exactly is Residual Income?

"Residual income is reason that MLM business opportunities can be so lucrative. It's reason why as many as 10% of new millionaires made their money in MLM... and who knows how many settled for just half a million?"

You're looking into business opportunities on net, and you keep coming across term 'residual income'. At first, you ignore it, one more piece in puzzle that constitutes trying to find ways of making money online. But residual income keeps popping up. It seems lots of people are making a big deal out of this. Probably, it would be a good idea to find out what it means.

Residual income, also known as royalty income, is income that you keep on getting for months or even years after work you did to earn it is finished. So, for instance, a song writer will get royalties on his song every time it is played on radio, even years afterwards. The royalty for songs and literature lasts throughout author's lifetime, plus 50 years, paying a small amount for each airplay, which can add up to a lot of money over years. A big hit brings in a huge amount, which gradually fades down to a tiny trickle over years, depending on popularity of artist.

How do you make Residual Income?

Not everybody is a pop singer, though! So why do people online go on about this so much? How can an ordinary bloke earn residual income? Oh, heck, I'm no good at writing stuff...

No, no. Chill. There's no need to worry. The way to earn residual income does not necessarily involve any writing skills at all. For example, you can make residual income as interest on shares. But you may prefer not to invest large amounts of cash in an institution that can drop through floor and take all your hard-earned savings from you overnight.

Another possibility is investing in property. Buy a house, do it up, and rent it out or sell it on for a profit. A lot of work. A lot of up-front investment. And no guarantee housing boom is going to continue long enough for you to even get your initial investment back.

But there is another way...

Looking for a Residual Income Opportunity

The way to earn residual income that you have been stumbling across all over net is almost certainly a variation of type of business opportunity known as MLM ('multi-level marketing'), relationship marketing, network marketing or referral marketing. There are many of these online, all offering different products, different pay plans, different startup costs and different trading zones.

At first glance, they all seem much of a muchness, but look again and you will find there are many pitfalls for unwary. It's important to do your homework, and check out exactly what is on offer for your initial investment.

But it's definitely worth effort. After all, residual income is reason that MLM business opportunities can be so lucrative. It's reason why as many as 10% of new millionaires made their money in MLM... and who knows how many settled for just half a million, or less?

Finding a network marketing business

Obviously, level of investment is a factor for most of us, but in general, you will probably find required investment is pretty minimal, far less than setting up your own business or buying a franchise. Once you've scraped together enough for your initial investment, it's time to find MLM for you.

Is it legal?

The first thing you absolutely need to consider is: does this opportunity follow rules governing network marketing businesses? You probably know that pyramid selling is illegal. Many people believe that MLM and pyramid selling are same thing. This is not case, as MLM is completely legal. So, how do you tell them apart?

As a swift rule of thumb: if you earn your money from sales or from getting customers (or recruiting others who sell or get customers), then it is a legal MLM business; if money is paid out merely for recruiting other representatives, with no customers or sales involved, then it is an illegal pyramid scam. Steer well clear!

• Pick a product you can be proud of, at a good price. It's much easier to sell something you consider to be worthwhile. How sincere can you be about a shoddy item, or one that is overpriced? Before you can convince customers to buy, you have to convince yourself.
• Pick a market you can sell to. If you're over 50, don't try to sell products aimed at kids under 20. You don't speak same language or see things same way. Similarly, if you're younger, products aimed at pensioners are probably not your area.
• Even if you are pitching to right market, it's also important that you feel right about selling this product to your market. For example, if you have a product that is aimed at people over 60, but you feel bad about selling goods to pensioners for some reason, it would be better choose a different product with a different market.