Active Income vs. Passive Income

I guess the best way to explain passive income is to pit it against active income. Say you write a 500-word article for the internet. You have the option of selling it as a ghost written piece to a company in need of web content, or you can keep your name attached to the article and place it either on your own site or on a web content site like Suite 101.com or Associated Content. There are plenty of content sites available on the web.

By selling your work as a ghost written piece for web content, you can earn anywhere from $5 to $12 per article. Some sites pay less and few (very few) pay more. If you post it on a content site like Suite 101 or your own website, you will not only retain the copyright for your article (thus building your writing portfolio), but you stand to earn continued income on the article.
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The income you earn depends on the article subject, how well it’s written, the site it’s posted on and how well it is optimized for search engines. The payout per month may seem small, but over time the payment will add up. The more traffic your article gets, the more income you can earn. The income from that one article will exceed an upfront active payment of $5, $10 or $12.

One of the nice things about residual or passive income from article writing is that you continue to receive payment as long as the article continues to generate traffic. The key to generating substantial income is learning how to write articles for the internet and locating the best places for your articles.

Passive Income Example

I’ll give you an example. I currently write for Suite 101.com. They require their writers to write a minimum of 10 articles over a three-month period of time (not difficult to do at all). As a result of writing for them, I’m earning a little over $100 per month, every month (not enough to retire, but this is only one small basket in my freelance writing arsenal). The amount seems to increase each month. Keep in mind, however, that the payout depends on the article topics.

I could have chosen the active income route and sold each article as a ghost written piece. However, I would have to continue to write at a feverish pace in order to continue to earn money as freelance writer. Don’t get me wrong, I still write at a feverish pace, but I write that way to build my stream of residual income. I don’t write passive income articles exclusively, but as my residual income stream increases, it will replace my need for active income articles.
To be truly successful in earning residual income from your writing, you need to become familiar with SEO (search engine optimization).