If a person is going to earn residual income then one of the first things they should understand are the payment methods used for paying a residual income. Nobody gets into residual income opportunities that is not interested in making money, so it is only smart for a person to understand how they will be paid that money. There are seven ways generally used to pay out residual income. Some ways have been very successful, but others have not. That is why it is so important that a person has some idea about these methods before getting started in any residual income opportunity.

In the beginning the main payment structure for residual income was a uni-level matrix plan. This was also known as a pyramid. This method hinged on getting people to sign up in multiple levels. The original person would be on top of the pyramid and rely on those below them in their pyramid to make them money. If all worked out then the person at the top would make a great income, but this type of plan is hard to build. It relies on people to keep recruiting and building that down line. It rarely works out because the person at the top is usually the only one making money, which is why newer payment methods were developed.

A forced matrix plan is the most common. Forced matrix plans also have some other additional payment methods associated with them that makes earning potential much greater. The basic forced matrix plan is like a uni-level plan, but each level has a limit of people. For example, the people the person recruits are limited to only 5. Then if they recruit more they fill a new level. This ensures everyone is making money. Under a forced matrix a person may also earn bonuses. There is a fast start bonus where a person earns an incentive to get as many recruits as possible within a limited time. They then receive a nice bonus pay out. There is also a sponsor bonus where a person gets a little extra bonus for every person they sign up. Matrix plans are also set up so that once a person recruits enough people they can then leave their original sponsors team and start their own. To prevent the original sponsor form losing out they earn a breakaway bonus where they still get a commission from the team that became independent. This helps everyone to work together and help each other instead of trying to keep those underneath restrained so they can not recruit too many people and break away.

The type of payment in a residual income opportunity can be confusing. There is always a lot of talk about down lines and commissions. It is really important for a person to make sure they understand the payment method. It is the bottom line of any residual income opportunity. Many opportunities have fallen by the wayside because they did not have a string payment method. By making sure the payment method is understandable and logical a person should be able to feel comfortable with their chosen opportunity.