Not All Pyramids Are Schemes

Generally, the first thing many people think of when they hear the words, “Residual Income” is this must be one of those pyramid schemes. Sadly, many people who think this way do not really understand or know there is a difference between genuine residual wealth creation opportunities and true pyramid schemes.

Merriam-Webster defines pyramid scheme this way: “A dishonest and usually illegal business in which many people are persuaded to invest their money and the money of later investors is used to pay the people who invested first.” Most people who do not understand think a pyramid scheme is anything with the people at the top making all the money and the rest making significantly less if anything at all. The image on the next page is a perfect illustration of what a pyramid scheme would look like if it truly existed the way most people define it.  
 
Now keep in mind we know most companies are not actually pyramid schemes, but the average person defines it in a way that most businesses would fall under this definition. Ironically, this line of thinking would also make our government a pyramid scheme!
 
The truth is, there are fraudulent companies that try to mask themselves as legitimate network marketing businesses. So, let me give you the bottom line of what a pyramid scheme looks like. If you see a company that is paying for the recruitment of others into the program and not for the sale of a product or service, congratulations, chances are you are looking at a pyramid scheme.
 
Legitimate companies will never pay you for the recruitment of others. What they will do is pay you what is often called a fast start bonus based on what product or service package your new team member purchases when they sign up. There are a lot of great direct sales and network marketing companies out there and many have been around for years. Even more satisfying is the number of people that have realized their dreams building a legitimate network marketing business from home. And in doing so, created residual wealth for them and their family.
 
It has often been said, “The Most Expensive Thing You Can Own is a Closed Mind.” Great opportunities are often missed because people have a closed mind. Do not let this be you. Do your due diligence on any opportunity being presented to you and do so with an open mind.
 
The Business Dictionary defines network marketing this way: “Method in which independent agents serve as distributors of goods and services and are encouraged to build and manage their own team by recruiting and training other independent agents.” Basically, companies cut out the middleman to save money on advertising by paying you for sharing their product or service with others. The truth is most people are great network marketers, but they do not get paid. ​