Residual Income Vs. Passive Income

[Kane]

A lot of people mix residual income with passive income. However, there is a slight difference.
What exactly is residual income then?

Let's say you created a youtube channel. As long as your videos garner traffic, they will continue to make money for a long time, This is passive income.

You retire and receive retirement funds or a pension. That's residual income.

 

[Iboro]

Passive income is earned with little to no effort on your part, like renting out property or investing. Residual income, on the other hand, is a recurring income stream from previous work or investments, like a pension or royalty payments from a book.

Both provide income without active involvement, but passive income requires no ongoing effort while residual income is based on prior efforts.