For someone who has never earned it before, residual income can be confusing or may even seem impossible for anyone but creative geniuses to earn.

To put it simply, residual income is money that you earn for work you already did. For anyone stuck in a “regular” job, this seems like heaven – you can do more work tomorrow, and keep earning from what you did today for years to come!

Residual income frees you from the cycle of “time for money” or labour for a particular wage. It helps you recognize that your time per hour isn’t worth a fixed, generally too-low amount. You’re working for yourself, meaning that you earn the full profits from what you do, rather than having it passed down through the company until you earn a fraction of what you’re really worth.

The math of residual income is one of the most convincing cases to follow it. For example, say you build a website every day that generates $1 per day in ad revenue (not an impossible chore, and even enjoyable if you know what you’re doing). By the end of each week, you can see your efforts paying off with $7. By the end of next week, you’ve doubled your income. At the end of the third week, you’ve tripled your first week’s income… and so on. If you keep doing this every day for a year, assuming all your websites continue earning this much, you’re earning $365 a day in residual income… or $133,225 a year hands-off.

There are a number of different ways to earn residual income. The best ways generally involve creating something: an ebook to sell, a book to publish on Amazon.com, music, graphics, websites… the possibilities are numerous. If you don’t want to create your own product, you can get into affiliate sales and sell others’ products. For instance, if you create a free website to promote a $50 product and you get a 50% cut of the sale, every sale you refer is worth $25, and the website can keep promoting the product for months or years to come.

Before you start earning residual income, a good thing to do is to assess your strengths. Are you great at coming up with information about a topic, but you’ve always hated writing and you don’t want to deal with any other parts of the process of publishing? No problem! You can create an ebook by using software like Dragon Naturally Speaking, talking to the program which then transcribes your words into text. Hire an editor to make the corrections necessary, then hire someone to format and publish your ebook for you. Nearly all the process can be outsourced if you wish and if you have the knowledge.

On the other hand, if you love learning new things and have a variety of talents, you can do everything yourself for no expense at all, which will take longer but be enjoyable if you really want to try it yourself.

Residual income is a fantastic way of earning money from your work long after it’s done.