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Recurring Income

May 4, 2022 • 2 min read

A recurring income, which is oftentimes referred to as passive or residual income, is earnings that a person receives on an investment or asset that continuously pays profits without the investor having to put in additional work for it to be profitable.

For many people, a recurring income can be a rental or investment property that offers them monthly and annual income without them having to work for those profits. Another great example of recurring income can be from an investment or bond purchased bet left to mature and now distributes monthly payouts.

A person can have both a recurring income or residual income, or perhaps a linear income. This means that on top of the monthly earnings they receive from their full-time job, a recurring income can be an additional or secondary income for them.

What are examples of recurring income?

There are many types of recurring income structures that exist, and for some people, having more than one income is a regular occurrence, as this offers them better financial stability and security.

Profit-sharing as an angel investor
Profits obtained from rental properties or real estate
Dividend payouts from a private equity fund
Any dividends paid from owning stock in a public company
Earnings from rentals such as Airbnb
Any form of royalties
Profits from the sale of cryptocurrencies or Non Fungible Tokens (NFTs)

Although it’s possible for one to have a recurring income above traditional earnings, salaries, or wages – the Internal Revenue Services (IRS) treats recurring income as a different entity and has its own set of tax regulations and jurisdictions.

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² Represents an net annualized return, using an internal rate of return (IRR) methodology, with respect to the matured investments shown in your Portfolio experience, utilizing the effective dates and amounts of subscriptions and distributions to and from the investments, net of management fees and all other expenses charged to the investments.[read more]

³ "Annual interest," "Annualized Return" or "Target Returns" represents a projected annual target rate of interest or annualized target return, and not returns or interest actually obtained by fund investors. “Term" represents the estimated term of the investment; the term of the fund is generally at the discretion of the fund’s manager, and may exceed the estimated term by a significant amount of time. Unless otherwise specified on the fund's offering page, target interest or returns are based on an analysis performed by Yieldstreet of the potential inflows and outflows related to the transactions in which the strategy or fund has engaged and/or is anticipated to engage in over the estimated term of the fund. There is no guarantee that targeted interest or returns will be realized or achieved or that an investment will be successful. Actual performance may deviate from these expectations materially, including due to market or economic factors, portfolio management decisions, modelling error, or other reasons.

⁴ Reflects the annualized distribution rate that is calculated by taking the most recent quarterly distribution approved by the Fund's Board of Directors and dividing it by prior quarter-end NAV and annualizing it. The Fund’s distribution may exceed its earnings. Therefore, a portion of the Fund’s distribution may be a return of the money you originally invested and represent a return of capital to you for tax purposes.

⁵ Represents the sum of the interest accrued in the statement period plus the interest paid in the statement period.

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⁹ Statistics as of the most recent month end.

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