The 7 secret keys to wealth - Key #4: Residual Profits.

By: Nathaniel Tabares

This article is one out of seven that I wrote about wealth. The whole series contain a lot of free valuable information about key factors that can help you become wealthy. The rich do things in a different way. That difference is the one I want to explain here. Let's scrutinize together these strategies that can make you more money and help you boost your income.

The whole series contain the following articles . . .

1. Add Value.

2. The Multiple Streams of Income.

3. Passive Income.

4. Residual Profits.

5. Leverage.

6. Specialization.

7. Compound Interest.

In one of my other articles on this series I share information about passive income. Here I will go one step further and I will show you how residual profits can boost your overall profits.

It is all in the multiplication. That technique can multiply your efforts the most. The more effective your leverage is the more your efforts will be multiplied. Streams of residual income are a perfect method to do this.

For example, let's say that you write a book. You realize that when you get paid royalties from your art you don't have to be present to get revenues from your efforts. This means that you make an effort once and you get paid several times, right?

If you write a book you are able to receive passive income but not residual profits. You can sell that product to one person once. That same individual may as well purchase one or two additional copies to give them away as gifts if they really liked the book. On the other hand, what I mean here is that the book is a product that is intended to be sold to one person once. On average every client you get will purchase only one copy.

So, writing books is a business that allows you to have passive income but not residual profits. The same happens with millions upon millions of other businesses out there. But what if you can find a way to receive residual profits while receiving passive income at the same time? The answer is simple: your income will be multiplied.

For example, let's analyze the web hosting business. Selling web hosting is a very competitive business for this same reason, because it can be very profitable. Let's say that you own a hosting company and you have about 1000 clients. These people will pay you monthly some money to have their websites hosted through your company. If the average client pays $4 per month then you will have a recurring profit of $4,000 every month.

This is income you receive month after month. As long as the client stays subscribed you will keep receiving profits. Most website owners stay subscribed for months and even years. So, if you use your available resources to get more clients, your income will simply grow exponentially.

This is just an example. The web hosting business is not as easy as it seems because of competition. The competition is fierce on this field as well as other highly profitable businesses on the Internet, but the way I see it is that when I can receive residual income, I don't need many clients to be profitable on these businesses. The secret is that I can sell the same product to the same client several times over and over again.

So, this is the key concept. No matter what business we are talking about, as long as you can sell the same product to the same client, several times every year, you can receive residual income. There are many businesses that operate this way. Membership websites are a very good example like dating websites.

The best businesses you can come up with are those that do not exist yet. If you can imagine a way to receive residual income that no one else have thought about before, it could be quiet profitable for you.

EasyWebRiches.com © 2007