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Recently, I was revising the notes I took from a business training I attended sometime ago, so I decided to share with you an incredible business insight that will change your perspective.
Between earning linear income and passive income, which is better?
Well, to make sense of the question, let's attempt a distinction between linear and passive income. If you're being paid once per month for the work or services that you have provided, chances are you're earning a linear income.
Linear income is also called active income, where you earn one unit of income for one unit of your effort. To earn a linear income you also need to be present at your supposed workplace.
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Hence, doctors, lawyers, hawkers, or practically every employed or self-employed person are earning linear income. If they don't attend to their clients, they don't get paid.
What about passive income?
It is an income that you continue earning even when you're not working.
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Sounds unbelievable?
Believe it, as thousands or probably millions of people have made it. Passive income, also known as residual income, is a stream of income which you can earn many times, with your one unit of effort.
Let's briefly explore some examples of sources of passive income:
ROYALTY INCOME. Do you know that singers and song writers are paid royalties every time their songs are played on the radio/TV, regardless of how long ago they made it? This is a form of royalty income and the best part is, it continues for the rest of their lives. Of course this also includes those MLM home-based businesses.
DIVIDENDS. This can come from stock investments, where listed companies share their income with share holders in the form of cash or stock dividends. Dividends also come from mutual funds.
REAL ESTATES. Your real estates can be rented out to earn a good amount of passive income!
INTEREST INCOME. Interests from savings / fixed deposits.
WEBSITES. With increasing availability of internet, websites have become an effective place to sell your products and services to the growing population of internet users and earn big bucks!
People actually get rich by simply having multiple streams of passive income!
So, would you rather earn linear income or passive income? Receive more sense!
Have an amazing day!
See you @prettyrose next Monday for another piece on BusinessMonday. Also tomorrow before 10:00 CAT for a motivational piece. Seehttps://steemit.com/steemit/@prettyrose/common-sense-project-new-publications-alert
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©Micheal N Micheal
