Network Marketing - Why Residual Income is Better Than Linear Income

If you've looked at home business opportunities, you've probably heard the terms "linear income" and "residual income". These terms illustrate the difference between income you make from a job, and income you receive from a network marketing or MLM business.

Let's take a look at the difference, and what it means to you.

Linear income is what you earn at a traditional job. You only get paid when you are actively working. Regardless of whether you're paid hourly, on commission, or on salary, your income is based on the time and effort that you and you alone put in.

One of the bad things about linear income is that you don't have many options. If you decide to work fewer hours, for whatever reason, your income will immediately drop. In the case of a salaried position, you may not even have an option to work fewer hours. This seriously limits flexibility for parents who wish to spend more time with their kids. If you want more from life that working at a boring job all the time, you'll typically be limited in your choices.

If you're stuck in this rut, you know what frustration is all about. How much you get paid and any raises you get are dictated by your boss, or a board of directors somewhere. Your boss controls your hours, the time you get up in the morning, when you can have a vacation, and in some cases what you do on your own time. You have a job as long as your supervisors like you or think you're useful - no longer.

In recent years, the trend in America has been for companies to cut positions and assign increased responsibilities to fewer workers. How many people do you know that do the same job, by themselves, that two or more people did just a few years ago?

While there is nothing wrong with working hard, and cutting costs to remain competitive, the fact is that employees in many companies now face much longer hours and greater responsibility. Along with this comes increased stress and unhappiness.

How do most people live their life? They go to work day after day, hoping to make it to retirement age so they can get out. Do you know what is really sad? By the time many people reach retirement age, they still find themselves limited in what they are able to do. Many dream of retirement so they can travel, or just sit back and enjoy life.

Unfortunately, far too many retire and then have to re-enter the work force on a part time basis to make ends meet. They most likely will always have to keep a job just to pay all their bills and live comfortably. It just shouldn't be this way.

A lot of people think that there are only two ways to make a "real" living - working a traditional job, or owning a storefront business (such as a franchise). Believing they have no real choice, they slip into a deep rut. They get up, go to work, come home, then go to bed. The next day, it starts all over and repeats until they reach the weekend. They get two whole days to enjoy themselves, then it starts all over again....get up, go to work, come home, go to bed. This goes on month after month, forever.

Now, here is the contrast between linear income and residual income.

Let's say I write an e-book called "How to Make Your Cat Obedient". Yeah right. Anyway, I write the e-book and package it up ready to download.

Scenario #1 - I have been hired to write the e-book by an online publisher. The publisher pays me $1000 when I complete the project. That is linear income. I make $1000 one time for my work in writing the e-book, then move on to a different job or project.

Scenario #2 - I write the e-book and put up a web page to promote it. I advertise the e-book and recruit some affiliates to help me sell it. Every time someone buys a copy of my e-book, I make a net profit of $20. This happens every time someone purchases my e-book, for as long as I choose to sell it. Once I have written the e-book and set it up for sale, it makes money for me while I move on to other things. This is residual income.

See the difference?

Linear income equals one project, task, or block of time for your efforts in exchange for a fixed amount of money. You never get paid again for that project, task, or block of your time.

Residual income equals one project, one task, or a particular block of your time that pays you back many times, not just once.

Perhaps it's time for a change? A network marketing or MLM business can redefine your future. This business can bring you more freedom and flexibility than you've ever known.

If this sounds interesting, are you willing to focus and work hard for 3-5 years establishing your own home business and building a full time income? Consider it seriously - it's a decision that can change your life.