What an odd article title! What "truth" do you need to know? Would you like to know, or be assured that getting involved in a business that provides passive income is a good one? A good thing to invest your time and money in? Are you looking to be educated that investments like stocks/bonds and other money market fund generators are a good thing? Do you really not know that "passive" income is money worked for once, with residuals continuing to come in?

Passive, or residual, income is exactly that: you do the work once and then receive income over time that was/is generated by that initial work. One of the best examples of this is a direct marketing business. A truly golden direct marketing business (and, yes, there are lots of them with products that range from candles to perfume to soap to vitamins) is one where you invest (usually) a small amount for sign up and sell the product. You use the product, love the product and tell others about it. You generate retail income - this is not passive income.

The other element of a direct marketing business is that some of the people you tell about your wonderful product will either 1)desire to become a distributor so that they can purchase wholesale from themselves thus saving money, or 2)they like the business model and want also to generate residual income.

The income generated that is the "residual" income are the commissions from sales from everyone you sponsored as a distributor, everyone they sponsored and so on. In a really good direct marketing business model (and, yes, there are some excellent ones), it is possible to see unlimited potential. What makes the potential for income unlimited is a combination of factors including the marketplace in which the product sits (market share), the viability of the corporation/management team behind the distributors, the quality of the actual product, the timing of the product into the marketplace and the business model itself - how aggressive is the compensation plan?

The "truth" about passive income is that in today's economy, it could be the retirement plan many of us simply don't have and won't have available to us. The "truth" is that passive, or residual income, can make dreams come true.

Learn more about this author, Linda Smith.
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