Recurring versus Residual Income

I am splitting hairs here a bit, however, I want to point out a difference between two terms based on the income platforms we employ.  Many times, recurring and residual income are used interchangeably.  From my perspective, they are not the same.  

Both are also referred to as "passive" income because both continue to pay regardless of whether there is still active work being done.  However, in the models we use, for income to recur (periodically), an effort has to be applied to make it happen.  

In other words, if you need to work with people to get paid, it is not automatic.  It is "earned" in the true sense of the word.  It can and will recur, based on the business model, but it is not automatic.  It is dependent on people doing something in order for you to derive any income.

Residual Income, on the other hand, is "automatic".  It is tied to automatic payments on a calendar basis and linked to someone's bank account, credit/debit card, PayPal, Zelle, CashApp, Bitcoin... account.  It is more aligned with a subscription, royalties, rentals, etc.  

As long as people do not "cancel" their contract, they will continue to be billed and you will be paid.  Like any of these:

On the other hand, recurring income looks more like this:

You need to work with people to ensure the results "recur".  Again, it is built into the model to make it possible, but it does not happen all on its own.

We include both in our core offers.  We start with recurring income because this is a people's business.  We then migrate to subscriptions whenever money is flowing and the pressure of a monthly subscription is eliminated due to paying for the subscription comfortably out of profits.