Passive Income Vs. Residual Income

[IB D]

Passive income is an income that comes from an investment you have made. While residual income comes from the work you have done before. If it is possible to build both passive and residual income, an individual should do it.

 

[Stardom22]

According to me it's a little bit more easier for one to make residual income than passive income. The reason being residual income doesn't need an upfront capital while passive income requires some capital for the start for it

 

[IB D]

I think passive income pays more than residual income in the long run. When you begin to reap the rewards of your investments, it is always huge. And residual income is not easily accessible to everyone.

 

[eldavis]

Its very easy for people to mix them up, even experts tend to call passive income residual income most times. Back then i used to think they where actually the same thing. But there are very little difference.

 

[Suba]

Passive income is often interpreted as income from investments or side jobs other than the main job, such as the results of rent, dividends and interest, or income from posting at RIF. Meanwhile, residual income is basically not a type of income but residual profit from a calculation that we can determine with the formula. Residual Income = Total net profit (Minimum Return X Total assets).

 

[nomad]

Passive income is an income that comes from an investment you have made. While residual income comes from the work you have done before. If it is possible to build both passive and residual income, an individual should do it.

Residual income also comes form the investment. let's say you have a term life insurance policy. When the policy matures, you get insurance benefits as well as bonus on your insured amount. You can build passive income without an investment.

 

[Rubz]

It is true that a lot of people mistake passive income for residual income and vice versa. They are actually not the same thing and i honestly think i prefer residual income to passive income.