Residual income is money a person has remaining after all expenses have been paid. Residual income is money left over after paying for housing, food, debts, utilities, and other monthly bills. The more residual income someone has, the more financial freedom they have to pursue other financial goals. In many ways, passive income opportunities are the same as residual income because passive income will raise a person's residual income. But passive income isn't always residual income if the person uses the passive income to pay off monthly expenses. But a passive income can certainly help raise someone's additional residual income each month, which one can put into retirement accounts.