According to Forbes, Michael Jackson earned $825 million in 2016. How could that be you may ask? We all know that Michael Jackson has not recorded anything since at least June 25, 2009. The answer, of course, is residual income.
Residual income is money that you earn even when you’re not “on the clock”. Trading time for money. That is the commonly understood idea of income. You go to work, put in your time and at the end of the pay period you get a check. Simple, right?
What happens, though, when you can’t put in your time for some reason? We get sick. Our kids get sick. Our parents get sick. Our car breaks down. Maybe there’s a snow storm. Maybe, just maybe, we need a little bit of “mental health” time just to ourselves to regroup and recover. So, what happens? Sometimes we have some PTO (paid time off) that we can use but there is always a limit to that. Usually, if we’re not putting in the time we are not making the money. Always, when we’re trading time for money we are building someone else’s dream.
We get an education and get a “J.O.B.”. Working for someone else. Imagine an income stream that continues even when you can’t or don’t work. Income from work that we have already done that keeps paying us. Over and over and over. That is residual income! The most common examples are actors, writers, musicians, etc, as I illustrated above, who continue to receive royalties long after the work has been done.
The possibility of Residual Income can be realized by all of us even if we’re not celebrities. We’ll be talking about this more in future posts.
Feel free to contact me with questions.
Thanks for taking the time to read.