My introduction to the world of internet business was through a MLM (Multi-Level Marketing Company). These are usually referred to these days as "network marketing" companies to avoid the MLM tag, which brings back some bad memories for the older generation. Those who were involved in pyramid schemes, mail fraud, and Amway in the seventies don't want to hear "MLM" again ever! I actually dabbled at Amway myself, and it was a great idea. I loved the product. It's time just hadn't come. There was no internet!



Anyway, I joined a health & wellness MLM over two years ago through a promotion where I was trying to win a laptop. Mine had crashed, and I was in a reduced hours situation in my job. I was desperate and naive. I'm 53 and I think that a little naivity is necessary for success. It offsets the negativity all around you just a little. That's where I first encountered the term "residual income", also known as "passive income".

Residual income is achieved by performing tasks one time, and being paid for them over and over. This differs from "Direct Sales", whereby you perform your tasks one time and get paid one time. On the face of it, residual methods are much more efficient, but results take longer to come to fruition.

In it's purest form, residual income is achieved by joining a company, then building a huge downline of "personally sponsored" members. It can be a long and winding road, and also expensive, but those who reach their goals can often earn thousands of dollars per month for years to come! The products are usually good quality, but don't sell well to the general public through normal advertising. (This is not always the case, there are exceptions). So, in order to support the "compensation plan", the product is sold to downline members at an inflated price. A monthly "autoship" is set up, and you must maintain this in order to keep your place in the matrix.

There are simpler and less time consuming variations. For example, my website hosting company has an "affiliate" option. If I promote their service, I receive a small commission for each person that I refer to them. Not just for the initial sign up, but for as long as that customer maintains his account. If I sign up 3 members, my hosting fee is paid for. If I sign up 3 each month, I could end up with an extra $200.00, $300.00 or more each month.

There are many other services which offer these residual income opportunities. There are hundreds of membership sites that have affiliate programs which are not nearly as painful as the "pure" MLM systems. These sites usually sell products to the general public, but realize that affiliates can help boost sales. The income is residual because you receive a commission each month for each member that you have referred in the past, not just new referrals!

Many of these are major corporations, such as http://Amazon.com, http://Overstock.com, etc. Others are large companies like Leisure Audio Books, Rocket Languages, Success University. Others are privately owned, like Marketer's Relief and Power Prospecting System.

In summary, residual income opportunities take longer to come into profit than direct sales, but they provide you with "passive" income for months or even years to come with little additional effort on your part. Do the work once, reap the rewards over and over.