Residual Income Opportunities

Residual Income, or passive income as it is sometimes referred to, is the ultimate revenue stream for both budding and experienced entrepreneurs. For those who have read the book “Why We Want You To Be Rich”, by Donald Trump and Robert Kiyosaki, you will understand the importance of generating such an income.

Not only does it ensure you receive a consistent cash flow, the continuing revenue stream allows you to do other things while your money works for you. When you now consider the opportunity one has to invest this income and compound their wealth, one really begins to grasp the strategies and vehicles the wealthiest people of our time utilize in order to accumulate their wealth.

Here at Brooks Wealth, we look to introduce you to this phenomenon of Residual Income and Wealth Compounding. First however, lets determine the Residual Income Opportunities available to you:

• Rental Income – A property can yield a good rental income and indeed, this has been a favored strategy for investor for many years. However, in recent times, speculators have flooded the market looking to “flip” properties for a profit. The result has seen an oversupply of housing and not enough demand leaving many people without tenants and subsequently, no rental income with a mortgage that needs to be funded.

• Business Sales – If you can create a business whereby you generate multiple streams of income on one single sale, you truly have a residual income generating business. This is the exact business model that Brooks Wealth follows with its affiliation with Wealth Masters International and it is the same business model we look to set up all our members with. With the potential to earn income from as many as five tiers of sales, while you either focus on other income generating strategies or simply enjoy more free time, you are placing yourself ahead of the majority of businesses that do not adopt this model and ultimately fail.

• Dividends – Investors typically are obsessed with growth. If a company is not growing, it fails to grab the attention of the general public and in particular, the trader. However, those people are missing the essential value that a low growth but solid dividend yielding stock can provide. This is the preferred method of investing for me personally as it means every quarter I am paid an income from a solid company that I am confident will continue to generate dividends long into the future. Take for example, Coca-Cola, would you really have any doubts that this company will remain profitable well into the future? I think not! Whats more, by reinvesting those dividends, as opposed to withdrawing them, you are now compounding your wealth.

While there are other residual income opportunities like Royalties, Advertising and Pensions, I wanted to particularly focus on the first three I went through. The reason is that real estate is still considered the prime investment vehicle. However, you would be well advised to consider the potential negative implications of such a deal going wrong. Can you afford the mortgage on the property if it cannot be filled and the value of the property actually begins to decline? If not, switch your focus from this capital intensive residual income strategy and focus on the other two.

The second option, identifying a residual income business opportunity, is indeed an extremely powerful tool. However, one cannot ignore the fact that this is residual income opportunity where most people fail. Starting a business can be capital intensive and a steep learning curve almost always ensues. It can also be a very stressful period when setting up a business so my advice would be as follows: If you are intent on setting up a business, be sure to create a detailed business plan in advance detailing the goals and objectives you plan to adhere to.

At Brooks Wealth, it is the third option, Dividend Yielding Stocks which most grabs our attention. The amazing thing about stocks that pay a dividend is that not only do you generate the income from the dividend, you also have the opportunity of capital appreciation from the stock itself. Taking into account the average annual return of the stock market is just under 10% and you can appreciate how powerful this model truly is. Whats more, with the advance of the internet, these stocks create a residual income online. This means you can get started immediately from the comfort of your won home, and once you have your research done, you can select stocks that will immediately start putting money back in your pocket. This wealth is greatly enhanced if you continue to reinvest the dividends you earn, a technique known as a “Dividend ReInvestment Plan” or DRIP.

With that in mind, take the time to visit the Brooks Wealth website and you will begin to understand the various options open to you. We also publish a weekly newsletter to aid you in your wealth and investment education and I would encourage you to sign up for this. Each week, you will get a better understanding of the concept of creating a residual income and just how many of todays wealthy utilize such wealth compounding tools.