I can be fairly certain that you have been accosted through social media by an old classmate, family friend, or distant cousin to partake in some wacky-sounding pyramid scheme that, as they often tout, “just works!”.
Yes, Multi-Level Marketing (or MLM) has been around for a very long time, but now that we use our social media as an extension of ourselves, the lines between friend and person you never talk to are blurred.
It starts with a random message asking you to invest in the same wacky company they have. Or to “come to my virtual party and check out all of ______’s incredible products!”
Or, my favorite – getting thrown into some Facebook group with dozens of posts advertising overpriced swag.
It might start out like this, but the goal is always the same – to get you to become a seller, too.
And – oh wow! – all you need to do is:
- pay the up-front costs
- buy a boatload of products and sell them
- convince others to do the same with the guarantee (read: not a guarantee) of a massive return on investment in referral bonuses.
How can you lose, right?
Well, the answer is actually “pretty significantly.”
The purpose of convincing others to join is to snag a little bonus off the top of what they make. They are encouraged to do the same, with every sale sending a little bit of passive income upstream to you. You are essentially hiring people to compete with each other (and you!) for sales.
You’ll find out pretty quickly that there’s a pretty significant overlap between the people you and your network know. Hence, the pool of buyers dries up pretty quickly.
On top of that, you will most likely annoy several people, family included, through this high-pressure venture.
In short, this is a mighty fine way to lose money as well as the respect of others.
Trust me when I say that there are much better ways to make money. Often, we don’t know the best methods to keep hold of what we have already or grow it to prepare for the future.
Give us a call at 513-563-PLAN (7526) or click here to book a 15-minute chat with us to talk about can help close the gap between what you think you have and what you don’t know you have (without resorting to joining a MLM to earn a quick buck). Your friends and family will thank you.
Regards,
Nikki Earley, CFP®
