The richest people in the world will say you must have leveraged income or residual income. But what if you can have both?

So what is the difference between leveraged and residual income, and why is it important that you actually go for both?

leveraged income

This is the kind of income you can earn from the work that other people do. Network marketing and affiliate marketing are two perfect examples of creating leveraged income.

This is how it works: a company produces its products and hires a sales team to sell the products for them. Then each team leader builds a team of affiliates who also make sales.

Each seller earns a commission not only from their own sales, but they also earn an additional commission, which is a percentage of the sales that affiliates make.

The more affiliates you can add to your team or downline, the more sales they will make, the more commissions you will earn.

Your income is then leveraged against the amount of sales your downline makes. In network marketing, every time one of your affiliates signs up a new member to their team, they also earn a percentage of their sales and purchases.

A good team leader will learn that you don’t have to have a great team to generate a secure leveraged income. He may have just a handful of successful, proactive team members who in turn build their own team and mentor his team members to each build their team, and so on.

The more people on your team, the more income you can tap into by earning additional commissions.

Now let’s take a look at residual income.

residual income

Residual income is one of the best types of income you can have. Why? You do the job once and get paid over and over again.

What are some examples of residual income?

Anything that you only have to create once, whether it’s a physical product or a digital product, that you can keep selling over and over again to hundreds and thousands of people without having to remake it.

The first thing that comes to mind is books. The author only has to write the book once, but it sells over and over again.

In the online world, there are many ways to create residual income, from creating website templates to writing digital e-books. Create the products once and sell them again and again.

Leveraged Income + Residual Income = The Perfect Combination

One way to build solid residual income, for example, is to create a kind of roadmap, a duplicable system that your team members can use to earn and recruit team members.

You only have to build and test that system once and share it with your team, teach them how to use the system and build their teams.

From there, you’ve automatically created a leveraged income from your team’s efforts.

It doesn’t happen overnight!

Residual income methods can work pretty quickly for some people. For example, you can write a whole series of autoresponders and sell them for $50 each over and over again, and make money almost overnight.

But it can take weeks, months, or even years to build a strong and successful team full of active members who will do what it takes to build leveraged income with a profitable network marketing business.