Residual income is an ongoing stream of financial returns paid to the producers, creators or owners of a specific entity of work. Earnings are generally related to ongoing sales or usage of that entity by the public. Anyone can earn a residual income but the value of the revenue stream depends on how successful your product is.

Most of us are familiar with the concept of royalties as a type of residual income. Authors are perhaps most known for receiving royalties on their work. Generally, they are paid by the publisher an advance fee and then they get continuous payments of royalties which might correspond to a small percentage of the price each book is sold for.

Authors are not the only people to earn these types of royalty payments, musicians and actors also earn residual income in a similar way. Elvis Presley still earns royalties on each piece of his music that gets radio airplay or is compiled in a new Elvis album collection. Every Elvis track downloaded on iTunes earns him a payment.

Actors also get royalty payments from the filmed productions they are in and will be paid each time their work is broadcast on television.

Perhaps a much less considered means of royalty payments is paid to inventors and patent owners. Any new invention belongs to the person who invented it and he can protect his ownership by securing the patent on it. Once that invention is used to create commercially available products the patent owner receives residual income from the sales of that product. It could even be later used as an ingredient for another product not invented by the patent owner but still warrants royalty payments. The patent on pharmaceuticals is a typical example. Royalties are still payable even after the owner is dead. The ownership of the music, person's image or patent get passed down through inheritance.

The new information age has brought a whole new class of residual income earners. The most momentous and prolific in growth is money earned from website ownership. It is possible for anyone to earn money this way. Many website owners continue to earn revenue from their sites when they are far away from their computers for long periods of time.

The way to earn money from a website is through advertising. There are many advertising streams that a website owner may choose from. One of the most used is Google Adsense. Anyone who frequents the internet will be familiar with this type of advertising. They are the blocks or columns of text ads by Google that appear on millions of websites. Every time a visitor clicks on one of these ads the site owner will earn a small payment. This can translate to hundreds of dollars a week for some of the best performing sites.

Although website ownership can earn very attractive residual incomes for their owners there is an important difference between this and the royalties earned from a book or movie or a patent. Generally speaking, moneys earned as royalties are paid on work that has finished or is complete entity in its own right. However, website owners may have to continuously update their websites in order to earn a residual income. Websites have to be seen as up to date in order to attract the volumes of traffic that will make them profitable from advertising. However, maintenance of a website is comparatively little work compared to the potential income that can be earned from it.

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