After you figure out how much money you need to retire, you have one or two big questions to answer: how long will you need that money, and where will you get it? Well, in a way, they both have the same answer. You find a way to make money that keeps coming in and, if possible, grows. Residual income is money that keeps coming in, usually without you having to do anything. For instance, if you build a house and rent it out, you are a builder. The rent you get is "residual" because it keeps coming in every month without you having to do anything else. Once you've paid for the upkeep, you'll have your residual profits. You will have that income as long as you keep the house, and you can keep the house as long as it makes money, ideally as long as you live.
So, what kinds of investments, besides real estate, bring in a steady income with little risk and change? Well, if you have enough start-up money, you can buy stocks or income trusts that pay dividends. You can easily look up a company's dividend history. Look for companies that have always paid dividends. This is a good job for banks and insurance companies. If they have never missed a dividend in the last 20 years, they might be a good choice. If the dividend payout has gone up slowly over time, you also have a strong winner. You don't really care about what the stock price does, but you do want to know how much dividend you can count on from the company.
If you invest $500,000* in a variety of dividend-paying stocks, you might be able to retire on about $50,000 per year*. (*These numbers are just examples; they are not real or verified.) If you can retire and live on $50,000, you know how much you need to save before you can retire. Another benefit of dividend income is that in most western countries, taxes on investment income are much lower than taxes on earned income. So you have a break in every way.
I think you should look into some great online businesses that can make you money. It's possible that you won't make a lot of money. But if you can make more money in the next few years than you could by working (unless you are the CEO of E*ron), and you keep putting that money back into a residual investment vehicle, you could retire soon. Your online business would also bring in money over time, and if you grew it and put some of the money you made into other areas, you would have more than one source of income.
But if you're like me, your first big problem will be how to get that first investment. Well, you make a business that needs less money to start up. Then you use the money you make there to invest in other ways to make money that keeps coming in. Internet marketing is a great place to start since more and more people are going online every day. It's easier than you think, but you have to do something to make it happen. Find someone who has done it before and is willing to help you get started. Don't second-guess yourself. The worst thing that can happen is that you don't make as much money as you thought you would, but you still made more than you would have if you hadn't tried. Depending on how your life is, that little extra may be enough.
Thank you for your time,
