The Myth of Residual Income and How to Really Get it!


Most people who start looking for a lucrative home business fall for the residual income myth.  That you can build something now and make money off of it FOREVER.  Like the money will keep rolling in over and over again.  While there is a residual effect that works with many lucrative home businesses the fact is that anything that takes active energy to build will always take active energy to grow or simply maintain.

The typical reason a company touts their residual income is often times there is no significant upfront compensation.  What is significant?  If you are going to create an income you need to know that in your own efforts the money you make will compensate you for what you feel is worth it.  The idea that you market products or services and the more people you get to market those products or services will one day make you millions is useless if you can’t create enough income to cover your advertising, product and basic day to day expenses of building that business.  Most companies tout long term residual because they want you to work today and get paid tomorrow.

Yes, having a residual effect is nice.  If I stopped actively working today I’d probably make 6 figures for the next couple of years based off of current clients and relationships I’ve already created.  But no company would truly create an atmosphere where their “top workers” could retire and never have to work again.  EVEN IF they seem to promote that.  What good business sense would it make to set up a pay structure that encourages people to stop working for the company?

The truth is most people never create a residual income at all because of 2 reasons.  Their upfront pay is insignificant and they get paid directly by a company.  THEY AREN’T truly self-employed.  A small business owner that is not affected by any direct company decisions is truly self-employed.  When you are not self-employed you suffer from poor company decisions, you suffer from compensation plan changes even if you’ve put in years of blood sweet and tears.  Maybe you were chasing that residual and then it just got a little farther a way.  Like a pay cut?  You suffer from company politics.  If a company pays you directly you suffer company decisions.  If your clients make payment to you directly and your clients give you your paycheck now you are 100% self employed.  No one except your client and you can control your business. 

To create real residual income you need to be able to have a lucrative home business that allows you to make enough money up front that you can get out of debt, pay your bills and have a significant amount to invest in other areas like rental property or dividend paying stocks so that you could truly retire with a STRONG RESIDUAL Income.  That way if a stock stops paying a dividend you replace it, if a tenant stops paying rent you replace him.  Bottom line you need to be self-employed not a contracted distributer for a product and you need to be able to make the money today upfront so you can truly pay off debt, reinvest it and have financial security so you can travel the world and make memories now with your family.


Good Luck in Your Search,
Stacy O’Quinn


  1. Rose Dallas says:

    Hi Stacy, truit ppreciate your sharing on this subject.”residual income”. Thanks much for shedding light on what it truly means to be self employed…and the benefits of being paid directly from your client instead of a company.

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