The importance of residual income to financial security.

[Etini]

Residual income is that income that keeps coming in from a one time expense of efforts or resources. They include royalties for creative activity, rentals, interests on money deposits and so on. Anyone that has a residual income can achieve financial security much earlier than one who doesn't. Why?

1) Residual income frees up your main income: When you have residual income, there is every likelihood that your main income would be freed up for you to utilize it for your personal needs while the residual income goes into savings, retirement and emergency.

2) Residual income gives you multiple streams to earn from per time which increases your level of financial security.

3) With a strong base of residual income streams, you can afford to retire early and live a comfortable lifestyle because it would always yield funds to sustain you.

 

[King bell]

Also referred to as passive income, residual income is a critical aspect of financial security since it ensures that one keeps on earning money even when not actively engaged in working. It is important in diversifying the sources of income, ensuring stability and consistency, achieving financial independence, accumulating wealth, mitigating risks and offering lifestyle flexibility. People can guarantee their future economic wellbeing by establishing multiple channels of passive incomes such as rental earnings; dividend from shares ownership; author’s royalties or affiliate marketing compensations for recommendations made through websites. By doing this they will be able to take care of their old age expenses, follow their dreams and maintain a standard way of living. Residual income also allows for long-term growth through compounding returns and reinvestment of earnings resulting to financial independence, freedom and resilience against unpredicted monetary distresses later in life. On the whole, residual income is essential in terms of both present day demands as well as possible future aspirations when it comes to anchoring solid foundation financially.

 

[btaliat]

Passive income and residual income are not the same. They may surely have some similarities but they are not really the same thing. Though that is not the main theme of this topic. While passive income may mean momey that is made while we are really working actively, residual money may mean the returns on the money that we have worked for.

Residual money is very important for a business owner. The money keeps the business going. As we all know, business owners need to have more sources of money to make sure the business is sustained.