By Tim Merrell, Dental Guy copyright 05-2005
I rushed upstairs dodging toys, two small children and a border collie. I grabbed phone just before answer machine kicked on. “Do you know how much I had to pay IRS this year?” was question. Before I had a chance to answer, my sister revealed details. The next question; “How much did you have to pay?” Once again, she spoke before I could answer. Then with a sigh, she said, “I don’t understand how taxes work.”
I explained that if she started a part-time home based business, not only could she get benefits of tax write-offs, but any loss she may incur in first years of business would be deducted from her husband’s income.
“Oh you’re talking about one of those MLM type businesses, aren’t you?” She coldly questioned.
“Not just any MLM business, but one that would give you a residual income.” I answered.
“What’s a residual income mean?” She asked, now with interest in her voice.
“In most businesses, you sell a product, and hope that client continues to buy product. Therefore, you must market that client each month. However, in my business, you sell one time, and get a check every month without ever having to re-sell product again to same customer. In essence you make money, while you sleep.”
“You mean like web hosting, or internet services?” She inquired.
“That is one type of product, but selling that stuff, is usually best handled by techie types, only because of technical questions people ask. Actually, I’m talking about a company that has been in business since 1992, and pays a commission rate of 30%.”
“No one pays a 30% commission,” she flatly replied.
”There is a company that does, and I’m getting checks.” I continued. “Also, I get a check every month, even if I quit selling. That’s a true residual income, and I am building a retirement income.”