What is residual income? Residual income, also known as passive income, is money that you earn after your initial work or investment is over. Residual income is contrary to linear income, which is the kind of money most people earn. Linear income is the money that is in direct proportion to the work completed; the most common example of that is the common paycheck. You work for forty_five hours at $20 per hour, and you earn X hundred dollars. In order to earn more income, you have to perform more work.

Residual income, however, allows you to put forth an initial investment or create a product once, and continue to make money off of it while you pursue other avenues. Sounds great doesn’t it? Of course it does; it makes good sense to try to earn some residual income.

Here are some ways you can do it:

Write some Lyrics for Music. Once the initial work is done, you can earn a percentage of the sales of the work for as long as it is marketed. If you self-publish your work, you can make residual income without having to share the proceeds with a third party.

Lease a portion of your land to someone else who needs or wants it. If you have acreage, you can lease it to someone who needs land for her horses or cattle. If you have property that borders a highway, you can let a company put advertising on it in exchange for a portion of the advertising revenue the sign company makes with the billboard. If you live in a place that is rich in oil, let a company drill on it.

Buy an apartment building, house, or commercial building. Charge rent and collect it every month.

Instead of living in a single-family dwelling, buy a multi-family building. Live in one apartment and rent out the other apartment(s). This way, someone else pays your mortgage for you.

Become an internet marketer and choose someone’s product to sell. Simply write an article about the product and use it to drive traffic to the product month in and month out.

If you have a web page, there are companies that will pay you for advertising space on your site. This is passive income at its best. You created the web page one time but now others are paying you month in and month out; without you having to build another web page.

Invest some of your “extra" money, and make money in the form of interest.

Set up a referral plan with another person in a related line of business. For example, if you are a plumber, it might behoove you to get together with an electrician and a carpenter. Every time one of you refers a customer to one of the others, you get a payment for the referral.

Passive income, if you can find a way to create it, just makes good sense. If you think creatively and are willing to put forth the initial investment and/or work, you can increase your income and self-worth tremendously with effective residual income methods.