Sunday, December 4, 2011

How To Utilize Residual Income

By Shelly Murdock

Residual income is the amount of money that one has after they have paid all their debts such as credit cards and mortgages. This amount is calculated on a monthly basis because most bills are paid every month. If a mortgage balance is paid off entirely, any amounts that were previously used towards the balance can now be considered available funds to be used in whichever way the person wants.

Banks currently have tight lending rules and if they consider advancing a loan to an individual who is looking to make money, then they will look at their credit history, salary and how much money they have after paying all their bills which determines how much they can put aside to pay the borrowed loans.

There are many ways that an individual can earn this type of money such as having a day job, having an oil company drill in one's property and then get paid. Buying a building and then leasing it out can give one recurring funds. The individual who seeks to earn this money can have receive it for the long term.

Many people have dreamt of retiring at an early age and they may be able to do so with regards to getting long term payments through contracts. For one to get these funds, they have to know what they want to specialize in so as to get additional funds.Usually, for a person to get residual income for life, they have to invest some capital into the venture they are pursuing.

If an individual wants to stop their day job and work for themselves, they have to evaluate what skills they have and how they can market them to businesses. If their skills are beneficial to a company, they can relax knowing they will have residual income as long as the business uses their skills.

A great way to make money on a long term basis is letting others know of businesses who offer services and are not well known to the public. The individual can act as the advertising agent for the business and get paid commission for every person that is referred to the business.

If many people tapped deep into their minds and found out what they are good at, they would never have to work jobs that they didn't like. Specializing in an area where one is fully knowledgeable allows the individual to get paid for their expertise on a long term basis. This pay is called residual income.

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