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Submitted by: Dominik Hussl
One important issue is how to create and maintain residual income. As an employee, gliding toward the golden finish line of retirement is something that everyone has planned for and anticipated all of their lives. Of course, as an employee, you may be leaving behind the issues of commuting and being tied to the hours of a normal work week, but new priorities begin to emerge as you get closer to retirement.
What exactly is residual income? In short, these are the monies that are left over after all of the financial commitments are met such as mortgages, car payments, utility bills, insurance, credit card payments, and all other payments that are recurring on a month to month basis.
One could think of the revenue that they have coming in each month before they pay anything as their gross revenue. Then, think of what they have left after they pay everything that has to be paid as their net revenue. This net revenue is the same as residual income.
Proper planning leading into retirement should help make it easier to reduce the overhead of having such things as car payments and mortgages. If a person is able to pay these balances down or off before they retire, then the residual income will surely be much more than it would be should they find themselves in a place where they have to keep paying these bills after retirement.
Investments also are great sources of residual income. After the initial investment, whatever financial gains are made through profits or profit sharing is another source of revenue that could help the retirement years be much more comfortable and affordable.
There are many ways to create revenue streams to boost your revenue. Investments are certainly an option, and there are a variety of ways in which someone can invest.
The stock market is a common place where people place an initial investment, with some wise and knowledgeable assistance, in the hopes that that initial money will blossom into something bigger. While this can be risky, the reward can be quite lucrative.
Some people choose to put their money into an Individual Retirement Account or IRA. The money placed inside an IRA stays there and matures at a set rate until the individual retires. Early withdraw of this money may mean steep penalties so make this choice wisely.
Some people opt to take their retirement in a lump sum rather than draw monthly checks. This too could be a source of additional revenue if you either invest the money or leave it in an interest bearing savings or checking account.
The profit earned from leaving your money in the account could then be used as revenue while still leaving the principle balance in tact as security for years to come. This too has a number of risks because, once this account or these accounts are depleted, there is likely no way to replenish them. This again is a step to take for those persons who are sure that they can maintain the accounts without drawing all the money out at once.
About the Author: Careermode is an expert in choosing a
residual income
, or being
self employed
and
finding jobs for those over 50
.
Source:
isnare.com
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