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Guest post by: Cynthia Minnaar Become an Author

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Provided you do it correctly, passive online income can also be residual income. Firstly, let's distinguish between passive and residual income. Making money without being directly involved in earning it is called passive income. Making money over and over for doing your work one time is referred to as residual income.

Now let's discuss ways to earn passive online income with your own online home business using the MLM (multi-level marketing) business model.

1. Sales to Retail customers. A lot of distributors miss this option as an excellent way to earn passive online income.

As you will be using a website provided by the company it will not be necessary for you to even call your customers as they can order and pay for products directly from your website. Delivery of the products will also be taken care of by the MLM Company.

However, it will be your responsibility to drive targeted traffic to your website and you can automate most of this so you just play the numbers game. The more visitors you drive to your site the more potential online income you can earn.

2. Earn on wholesale purchases made by your downline. A very attractive thing about MLM is that you can earn on the purchases of thousands of people in your group.

This happens whenever distributors in your downline sell a product as well as when they purchase from themselves. As these distributors are in your downline you earn credit for the volume they produce. The more products you have passing through your downline the more passive online income you will earn.

The compensation plans for each MLM company differ, so you will need to check it out to see how much income you will earn. The commission percentages usually vary for each level that you can earn on.

What is great is that all this is passive online income because you do not have to get involved in the taking of orders and delivery of the products because the MLM company does it all for you. You did the work initially of sponsoring your distributors and now you reap the rewards for years to come.

3. Join another MLM Company. A few years ago it was not the done thing to belong to more than one MLM Company but nowadays you can. So once you are earning passive online income with one company you can sign up with another one and repeat the process.

The internet makes it all so much easier. By making use of the social media sites it is easier to sell more products and sponsor more distributors than you could have ever done prior to the advent of the internet. To get a MLM business up and running quickly make use of services such as Twitter, You Tube, Facebook, blogging and social bookmarking.

Once the initial hard work is done then you can relax a bit as the money comes in. You will see that joining more than one MLM company, building more than one downline as well as selling products in different niches are all a good way to earn passive online income.

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