Simply put, residual income is an income that is not dependent on your time or effort. It is dependent on an asset and management of that asset. You have to leverage other people’s time and money to create residual income and manage your assets.
Businesses can be a source of passive income only if you can replace yourself. If you are directly involved in your business on a day-to-day basis, then it cannot be termed as passive income. To turn your business into a residual income source, you have to put the right kind of people and systems into place so that it operates without your presence and interference. Most entrepreneurs start businesses to generate millions but instead land up shackling themselves to their business and can’t even afford to take a holiday in years.
Control Asset Without Involvement
The best kind of residual investments are those where you – as the owner of the asset – can exercise active control even when you are not involved in regular operation. You must have adequate control over your assets so as to positively impact the level of generated income.
Use Other People’s Money
Using other people’s money and resources is the key ingredient of creating residual income. It buys you time and effort. Once you start creating residual income, you will start attracting more and more of other people’s money to grow even richer. If done correctly, you will get caught in an upward spiral of residual wealth creation.
Residual income, without a doubt, is the holy grail of investing and the key to long-term wealth. This is a critical step on your road to wealth creation. The earlier you begin this journey, more success you will achieve. You can create a tidal wave in your financial security and prosperity if you do not waste a day. It is simple and easy. You just have to begin and there is no better time than today.