There's a lot of talk about creating residual income from freelance writing, and I seriously agree with the basis behind it. Residual income, or passive income, is money that keeps coming in, month after month, long after you've finished the work.
There are lots of great reasons to create residual income. Any freelancer who's serious about turning a love of writing into a lucrative career should learn very quickly how to maximize passive income whenever possible.
I personally have several forms of residual income coming into my freelance business. It's this passive income arriving each month that pays my mortgage payment and my utilities bills each month.
As with every other area of freelance writing, there are ways to seriously boost your residual income through the stratosphere and then there's slave-labor version of residual income. For those writers already determined to stick to the slave-labor versions of making money online, then I suggest you stop reading this post now. I'm about to TRASH Associated Content, Helium, Triond and sites just like them a lot.
Before I get into my slave-labor site-bashing, I will remind you that I did conduct an experiment at Helium to verify my findings. You can find my original experiment here: http://ravens-writing.blogspot.com/2008/10/writing-at-helium.html
I read a post on a networking site from a writer who only writes on revenue-share sites. This writer's logic went as follows:
100 articles written and submitted could bring you $100 per month in residual income. Wow. That's $1,200 a year! You just need to get 10,000 page views of your work to make it happen.
Um... I don't know about you, but getting 10,000 page views takes an awful lot of work, time and effort. You also have NO guarantee that you're going to reach that massive amount of page views, which means the average writer is going to earn significantly less than $100 a month from these options. What happens if you only get 100 page views? That adds up to a princely sum of UNDER $10 for 100 articles. That's hardly 'passive' income any more is it?
Besides, 100 articles sold at $50 each should have made me closer to $5,000 in upfront payments that could be paid off my mortgage right now, which would save me significantly more than $1,200 in interest payments in half the time. Or I could go on a nice vacaction with $5,000. Or I could buy a new computer. And that's without me having to worry about getting ANY page views!
Or I could aim at even higher paying markets and sell them for $100 each. That's $10,000 for 100 articles. Yes, that really is possible. I've already pointed at lots of places for you to find markets that pay this high - and higher.
Gee - I could even be contrary and aim at the really low-paying end of the market and still earn more money. Even at $10 per article, that's $1000 in guaranteed upfront payments without worrying about promoting it or finding page-views.
Writing so much and working so hard for a pathetic amount of a few cents per article at a revenue-share site is also nothing to do with creating a real, reliable residual income.
There are much easier ways to make residual income than writing hundreds of articles for a few cents each.
Types of Residual Income
Passive income, or residual income, doesn't have to come from writing activities. In fact, investors have been generating residual incomes for themselves for decades. Here are some ways to build residual income.
- Rental Income from buying investment properties
- Dividend Income from shares/stocks you own
- Interest Income from savings at the bank
- Royalties from selling a book/ebook or writing music or inventing things
- Recurring commissions from selling affiliate products on the internet (affiliate marketing)
- E-commerce websites or online stores
- Advertising revenue from creating effectively, correctly monetized websites
Hmmm... from what I can see, none of those methods of creating and building residual income have anything to so with slaving away, day after day, writing, submitting and promoting hundreds and hundreds of articles for a few cents IF you can generate thousands of page views.
However, if you read those options carefully you would have also noticed that four of those options have to do with working smarter online instead of harder. One of them is directly related to freelance writing.
Freelance Writing and Residual Income
Writing and selling articles is the 'bread and butter' of my freelance writing business. I write an article and then I research markets until I find one that will pay me properly for my time and effort. I receive an upfront payment for the highest amount I can possibly find. That's not residual income. That's bringing cash flow into my freelance business NOW so I can continue to pay my bills on time. That's making sure I have enough money in my accounts so that I don't have to go back to a day job any time soon.
Residual income is the 'cream and sugar' of my freelance writing business. I do receive quite a lot of residual income each month as well as my upfront payments. My residual income comes from ebooks, affiliate sales, paid ads on several blogs, royalties from anthologies as well as a few well-placed investments. It's a vital part of my total freelance business income.
Writing and selling short stories and fiction creates both a little bit of upfront money as well as residual income. Most short stories sell for between $40 - $100 upfront, plus you get paid royalties if you sold the story to an anthology that sells well.
Writing entire books or ebooks can generate a very healthy residual income for a long time. You complete the work once and then you continue to receive royalties for as long as that book keeps selling. No hassle about getting enough page-views. No difficulties in finding something else to write about tomorrow. Just royalties coming in month after month.
Advertising income can generate quite a significant amount of residual income. I see a lot of people complaining about not earning enough from Google Adsense or Bidvertiser or Adbrite - yet imagine how much you COULD be earning if you wrote 100 articles and put them on your own blog? Instead of a few cents per page view, you could actually be keeping all the profits for yourself. (I'll give you a hint: this post is number 83 on this blog. I reach payout with Adsense every month.... )
I'll also write an entire post on creating ebooks in a later post - there's too much to add here.
So the next time someone advises you join a revenue-share site, think carefully about it. If you're willing to write hundreds of articles and spend large amounts of time generating more and more page views in order to earn a few extra dollars a month, then try it.
If you're willing to learn about real ways to create residual income that don't involve slave-labor, then perhaps direct your time and energy to options that can double your income without even a fraction of the work involved in working at those slave-labor sites.