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Jun
11
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Most people do not understand the difference between Linear Income and Recurring Income. I like to use recurring or passive income. Some people call it residual.
LINEAR INCOME
If you are like most people, you have to work for a living. If you don’t work you don’t get paid.
I will give you a couple of examples. First one is the bus driver, he drives his bus and when he is done driving his bus at the end of the day he gets paid for the time he drove the bus. If he does not drive the bus he does not get paid.
Another example, a brain surgeon. The brain surgeon goes to work and preforms his surgeries and when he is done for the day he gets paid for the surgeries. But if the surgeon is unable to work, do you think he gets paid? No.
So you would agree that both the bus driver and the surgeon are in the same boat. The size of the income is not the same but they are in the same situation. They work, they get paid. They don’t work, they don’t get paid.
RECURRING INCOME
The best way to discribe recurring income is that when you do something right the first time, you get paid over and over and over again for what you did.
I will give you a few examples of this.
Most people have heard of Elvis Presley. Elvis recorded many amazing songs that turned into hits and he has made many movies. Elvis has been deceased for many years but we still hear his songs on the radio today. His daughter, Lisa Marie is getting a recurring income for the work her father did all those years ago. He did it right once and gets paid over and over and over again.
Another example is Michael Jordon, a famous athlete. Michael played basketball and was asked to be a spokes person for Nike. Michael became famous, signed a contract with Nike, shoots some commercials, gets his picture taken and receives a check. So Michael was asked to do this from Nike to represent them and he keeps receiving a check over and over and over again for being such a great basketball player. He never has to play in another game. He did it right already and will always be famous. Nike and other companies will keep offering him money to use the fame he created just one time. He can be on the beach or sleeping and the recurring income still comes in.
An other way to have recurring income would be if you had few million dollars laying around in your bank account and you get your dividend check every month. You did something right one time to earn that money and now that money pays you dividends each month forever.
Recurring income sounds nice but unfortunately we can not all sing like Elvis or jump like Michael and we sure don’t have a couple million dollars laying around in a bank account.
Recurring income is what most people building a MLM company or network marketing company are trying to achieve. You do the job once and have this check coming in month after month, depending on your company’s compensation plan.
So hopefully that sheds a little bit of light on the differences between Linear and Recurring Income.
I am currently experiencing the recurring income and I can tell you I love going to my mail box every week to get that cheque. Feels great and it keeps growing. I use a proven duplicable system, Mentoring For Free, and it is so much easier to create that recurring income this way.
Many people expect that all MLM companies will get them the recurring income if they have success building their program. You need to actually take a close look at this. Some will get you the recurring income alright, but they will not allow you to retire and keep the income. It’s in their policies and procedures, your contract.
Other companies have pay plans that never create recurring income. They talk about it and show you nice examples of how it happens but in reality, there is never any recurring income produced. The easiest way to spot this is to look at where the income comes from. If it is coming from sponsoring then as soon as the sponsoring drops off, the income is gone. That is essentially a one time sale. You only get paid for sponsoring someone one time. If the company product or service is sold one time, you have the same problem. In either case you have to keep sponsoring and keep selling. They make it appear to work by showing you how you make money from other peoples sponsoring and sales but it only works on paper.
Be sure you understand policies and procedures, and the company compensation plan before you build your house of cards like so many before you have done. Get the free training at Mentoring For Free.
Now you find yourself building your MLM business. You checked out everything and you know that if you build it, the recurring income will be there and you can retire if you like. But most people have been participating in the linear income model for so long that it presents a problem for them. They work hard at their business and make very little in the beginning. Often times they will give up just when they are getting close to seeing success, just because the old linear income model got in the way. Now they either drop MLM because they can’t build their recurring income quickly enough or they move to another company and start all over again.
When you fully understand the difference between linear income and recurring income, and learn to evaluate a company so that you know if you build it then the recurring income is really going to be there, then you will be on your way towards sticking with one company long enough to reach your goals. The day will come when you feel overpaid for what little work you do building your business.
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