Avoid Get Rich Quick Schemes
Get rich quick schemes are rapidly gaining prominence globally. High yielding investment programs, Ponzi schemes and pyramid schemes are the most common forms of them, opted by many people due to the high yield and returns as their investors profess. What are the dangers and concerns of these schemes? This article discusses the pit falls of get-rich-quick schemes and an alternative way to get rich slowly.
1. Pyramid and Ponzi Schemes - What are They All About?
A popular law firm in the US, Girard Gibbs LLP, explains Pyramid Scheme and Ponzi Scheme as follows:
“In both Ponzi schemes and pyramid schemes, existing investors are compensated by the contributions of new investors. Ponzi scheme participants believe they are earning returns from their investment, while pyramid scheme participants are aware that they are earning money by recruiting new participants.”
KIPI and Sergy Mavrodi’s MMM are examples of pyramid schemes as participants know that income depends on recruiting new investors, whereas most HYIP programs such as Traffic Monsoon and InvestDailyProfits are Ponzi schemes as investors believe the source of income is from advertising and forex trading.
2. Pitfalls of Pyramid and Ponzi Schemes
They work on the popular principle of rob Peter to pay Paul system. They are illigal in almost all countries, and though they can survive for a while, they are bound to crash as new investors will eventually dry out. The greed of the scheme owners can speed up the crash time.
3. Why Avoid Get Rich Quick Schemes?
“Wealth from get-rich-quick schemes quickly disappears; wealth from hard work grows over time”. [Proverbs 13:11 NLT]
The problem with get-rich-quick schemes is they don’t work in the long run. The vast majority of people who get involved with get-rich-quick schemes end up losing money. The only people who always win in get-rich-quick schemes are owners and administrators of these programs. However, because of most of these schemes are fraudulent and illegal, the owners risk the possibility of being sent to prison.
In any case, a prison is a befitting place for owners of get-rich-quick schemes as most of these schemes are operated by professional scammers and conmen anyway.
Unfortunately, many people are stubborn and end up learning the hard way that get-rich-quick schemes are controlled and manipulated by scammers and don’t work long term.
4. Ponzi Scheme Based Financial Plans
If you are one of these people, and can’t stop yourself participating in Ponzi schemes, then it is better to treat these schemes as some form of gambling as the chances of losing your money are extremely high.Whatever you do, don’t budget or plan your finances based on income you’ll be receiving from your schemes.
I know many Kipi investors who had budgeted to pay buy school uniforms, stationery, and pay for university fees with pay-outs they expected from Kipi pyramid scheme in January 2016, but unfortunately, the scheme collapsed in December 2015.
Sadly, I have watched many of my online colleagues lose thousands of dollars to get rich quick schemes and dreams get shattered right in front of their faces. Even if you are lucky enough to make money from a get-rich-quick scheme, the income earned will be short-lived, as by nature get-rich-quick schemes are not sustainable. Investing your money and time wisely is the best way to generate long term profits.
While the wealth obtaied from get rich quick schemes will quickly disappear, the wealth gotten from get-rich-slowly investments such as stocks or genuine on-line businesses will remain for a very long time.
5. Alternative to Get-Rich-Quick Schemes
There is an alternative to make money online without getting involved with Pyramid or Ponzi schemes. There are many other ways to earn money online. However, I believe learning affiliate marketing is one of the best ways to earn money over the internet for a newbie to the world of online marketing.
All you need to get started with affiliate marketing is Basic English writing skills, willingness to learn and the drive to put into action what you have learned. Affiliate marketing is the simplest and currently the most trusted method to earn money online.
If done the right way, it can yield satisfying financial results in just a few months’ time. There’s a lot of online resources and training for learning affiliate marketing, however I highly recommend a company which I consider to be the best for training affiliate marketers. The name of the company is Wealthy Affiliate. You can read a review I wrote about Wealthy Affiliate and find the answer to the question – How does Wealthy Affiliate really work?