MLM Residual Income Series Part 2: Why Residual Income is Better than Employee Wages

In part two of this series, we will answer another popular question, which is “Is it better to earn residual income or employee wages?” This is a complicated question, as some people think that employee wages provide more security, while others think that residuals are the way to build your income without doing much work. There are many ways to look at this issue, but first, it is important to know the differences between the two.

If you have not read my previous posting about what Residual Income is, you can do so by clicking here. Start there before you read this posting.

The difference between employee wages and residual income is very simple. When you are being paid a wage you will get paid a certain amount for every hour that you work. Most people earn their money this way, as it is the tried and true method to get paid for every hour that you work. Another commonality with people that earn employee wages is that they always wish their hourly pay was higher.

Residual income, as discussed in part one of this series, is money you make from work that you have done in the past. In MLM this is usually in the form of commissions or profits you have earned from someone in your network. The question remains, which is better?

Residual Income: Get Paid Over and Over For Working Hard One-Time

When it comes to the best ways to get paid, residual income is far better than employee wages, here is why:

-When you work for employee wages you will be paid only once for that hour of work. If you make ten dollars per hour then you will get ten dollars for that hour and you will never be paid for it again.

-With residual income, you can be paid several times for that hour of work. If you work 5 hours one day recruiting new people for your network, or selling products to customers then you will be paid for that time with commissions, possibly right away. The difference is that you can continue to earn money for these hours of work, even after the work is over. Earning ongoing commissions from customers and earning from sales members of your MLM network make allows you to make money from your work more than once, which is the biggest advantage of residual income over employee wages.

-Some people will tell you that residual income is not as secure as employee wages. This is somewhat true, as with employee wages you will always know exactly what you are going to get. However, residual income can offer just as much security. After all, you can continue to work an hourly wage or other types of the job while you are earning residuals. In the end, residual income really just allows you to supplement your income without doing any extra work.

Now that you know why residual income is better than employee wages, it is time to move onto the next part of the series, which will break down the differences between residual income and passive income.  You can do so by clicking here.  Things are getting interesting!  Enjoy!

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22 responses to “MLM Residual Income Series Part 2: Why Residual Income is Better than Employee Wages”

  1. Take charge of your present and future by opening up passive cash flow. Sure you work hard now to set up residual income but when your employee buddies are getting axed, you have nice next egg saved up, and the cash flow continues to increase.

    Great stuff Nate!

  2. Hi Nate!

    I always laugh when people say it is safer to have a job. HA In this economy anything can happen. Downsizing, companies folding, etc. Plus…you only can make a certain amount and that is it! Not to mention your time. Time is precious and who the heck wants to leave home, commute, and spend most of your time in an office.

    For those who are skeptic, I say to try something that can produce residual income while you are working your j.o.b. Before you know it, you will find that the journey is not only great financially, but it is a better quality of life.


    • Nate Leung says:

      Hi Donna,

      I agree with you. Employees are paid for their time and not only that, employers will pay them what they think they are worth, not what the employees think they are worth.

      The sad reality is that they may not like it, or agree with it, but they are ok with it because they feel there’s nothing else better out there unless they go job hunting again and try to find a “better” job.

      Building a residual income outside of your job is the best way to stabilize your financial situation on the back-end, and it compounds faster than a regular savings account of less than 1% would.

  3. AWESOME post!!!! Love what you have to say on this subject!!!!

  4. It may seem safe to have a job, but in an up and down economy it’s not so secure. Companies are always looking for a cheaper and yet more quality way to keep business going. If this means downsizing to save the company, then by all means people will lose jobs.

    On the other hand, with residual income, this is something you can build while you work as you said. This is a way to supplement your income just in case any type of downsizing comes into play. Plus once you build it enough where you’re consistently get residual income, now you have a better option to either stay at your job or quit to live off of your residual income.

    Good one Nate!

  5. Great post Nate!

    Enjoyed reading your comparison of residual income and employee wages and why residual income is so much better!

    Thank you for your insights my friend!


  6. Great post Nate and I love the website. You are so right in that residual income offers just as much “security” as employees wages. IMO, more because YOU are in control of your earnings, not your boss or company.

  7. Arleen says:

    I have to say that I have never been an employee. I started selling real estate and did that for 25 years and then started my own business. There is nothing like being your own boss and be accountable only to yourself. I will keep my residual income any day.

    • Nate Leung says:

      I agree, residual income any day over wages. Thanks for stopping by Arleen!

  8. pam schmidt says:

    You are right, Nate. Residual income holds the potential for a person to be paid several times over in the same hour! That’s the way to the full potential of wealth

  9. Luke Blower says:

    That’s it in a nutshell, there are only so many hours in a day. So wage labour is limited, residual income is not.

  10. Adam Payne says:

    Well said. Why out a ceiling on your potential? Makes no sense.

    Unlike you post, which makes perfect sense.

    Thanks Nate.

  11. Hi Nate,

    You have done an excellent job explaining residual income Nate.

    So many people don’t understand it nor were exposed to this way of making money. Me personally, until I was introduced to Network Marketing, I had never heard this term or passive income.

    Then I became familiar with “The Cashflow Quadrant”, by Robert Kiyosaki and when I read that, a whole new meaning of money came to my mind. It was an eye opener for me the first time I read about this. It also explains the difference between the wealthy and poor. Very Interesting. Kiyosaki is a great leader.

    Unfortunately, many people will have to work until the day they die and may still be in debt. But Residual Income is the way to go.

    Thanks Nate for a great Share. Have yourself a great rest of the week.

    Be Blessed,


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