I was listening to the MLSP Wake-up Call the other day. Tracy Walker, a top leader in MLSP was discussing the concept of residual income and comparing it to bank interest. She also threw out some statistics that the average household makes $50,000/year and works 2 and ½ jobs. The average household credit card debt is $10,000.

75 and Working at Wal Mart?

She then went on to talk about her visit to her local Wall Mart where she saw an elderly woman who was between 75-80, sweeping the floor and checking receipts of customers. The Elderly woman was probably working at Wall Mart since she could not afford to retire. I don’t think she was planning to work there 30 to 40 years ago. But things have changed since then.

Jobs Are No Longer Secure

No longer do people work at the same place for 40 years and get a pension and a gold watch when they retire. Most people usually don’t spend more than 2 to 5 years at the same company. They either work there for a couple of years and move on to another company for a promotion or are replaced by someone who is making less money.

Residual Income Vs Bank Interest

Tracy then went on to talk about the concept of residual income and compared it to bank interest. In Network Marketing, you earn a residual income by investing money into a business and learning the necessary skills for enrolling people into your business.

Each month you will pay a monthly fee called an autoship. Sometimes the autoship will be around $100 to $250 per month. I know a lot of people grumble about paying a monthly autoship. But if they learn the skills necessary to retail and recruit people into their business and take action, they can actually break even and make a profit in a matter of weeks or months.

The Power of Residual Income

Here is where I compare residual income and bank interest. Lets say you are in company XYZ paying $250/month on autoship and making $100 in profit (You make enough money to pay for your autoship plus $100 more) every month for 12 months. You are actually making an annual profit of $1,200 your first year in business investing $3,000 over the course of 12 months. That is a 40% return on your investment.

If you wanted to make the same amount of money by sticking your money in 5% savings account, you would have to keep a balance of $24,000 in your savings account all year long. So what do you think is easier sticking $24,000 in a bank that you probably don’t have or getting into Network Marketing, learning the skills and making $100 a month? Obviously it is easier to invest $250 a month, learn the skills and make $100 a month instead of sticking $24,000 in a bank for a whole year to earn the same amount.

The Second Year

Let’s assume that the power of duplication doubles your profit a month to $200 in year two. That is $2,400 in profit which is an 80% return on your investment. Your still only paying $250 a month. To earn that in a bank account with a 5% interest rate will require you to keep $48,000 in your bank account all year long. Many of you probably don’t have that kind of money to stick in a bank.

So What’s the Point

What I am trying to do is educate people whether or not you are a network marketer to understand the power of the residual income in network marketing. Notice that I did not talk about making $5,000 to $10,000 a month. Many people think that they are failing if they don’t make that kind of money. But that is not true. As long as you are making a profit, you are doing better than most people.

Making $1,200 in profit a year off a $3,000 investment is pretty darn good. That beats putting $24,000 in a bank account earning 5% interest. Today you probably have to put $120,000 in a bank account to make $2,400 since most of them only pay a 1% interest rate.

If that 75 Year old Lady would have learned those skills 30 to 40 years ago, she would be sitting pretty spending her golden years on the beaches of the world instead of sweeping floors at a Wal-Mart. JUST THINK ABOUT THAT!

Don’t End Up Like That Poor Old Lady Working at Walmart! Learn How to Make a Residual Income in Network Marketing Today!

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