Get rich quick schemes: How to avoid them

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You’ve probably seen how many get rich quick schemes there are. Some claim it’s easier than it actually is and others simply offer fraudulent plans.

Those scammers have not reinvented the wheel. They only took old schemes and adapted them to the new era.

The internet and social media have increased their reach but also have increased the craving of individuals to get rich.

Moreover, it is easier to create fake accounts, a fake website, fake email, etc … whatever is needed to create any semblance of truth.

Individuals see the luxury lifestyles portrayed by different celebrities and influencers and they want to reach that level as quickly as possible.

Without really asking themself if it’s possible to get rich QUICK, obviously, some have, but how many out of a million do get rich QUICK (overnight millionaire)?

Famous schemes

Here are some popular schemes. The majority of scams are derivatives of these. The principle stays the same.

1. Ponzi Scheme:

   This system starts with the scammer claiming that he can generate incredible returns. He manages to generate substantial returns because he simply takes money from new investors and gives it to old ones, pretending it’s their return.

   The most difficult is to have the first investors because he has nothing to prove what he says. But thereafter the initial investors will be doing word of mouth to their entourage to bring in more investors. 

   The scheme will fall when there won’t be any new investor or not enough. 

2. Pyramid Scheme:

   It sort of looks like the Ponzi scheme. But here the crooks are focusing on offering the vision of a real business opportunity. However, the problem is that they do not encourage you to sell products but to recruit new participants.

   As in the Ponzi scheme, new investors are the reason for the high returns. New participants usually pay an entry fee which is used to pay older participants returns.

   And as you might imagine, the system collapses once they won’t be able to recruit anymore.

3. Pump and Dump Scheme:

   This scheme is linked to stocks. The scammers start by promoting positive predictions for the companies in which they own shares.

   Once stock prices have risen enough, they dump their stocks and take their earnings.

How to detect them:

To help you spot get rich quick schemes, here are some things to watch out for.

• The sales pitch: They will usually say that the plan they are offering is easy to apply.
• It sounds too good to be true: Usually, significant results are associated with risky assets or fraud. If it’s big money but no risk it doesn’t make sense.
• Their name: They can pass for well-known companies, so look closely to their name. For example, instead of Bank of America, it could be “Bank of Amerika” or “Bank of Ameriika”. 
• Testimonials: In our era, it’s easy to have fake testimonials, so don’t get fooled.
• The promise of “guaranteed” returns: There is no such thing as skyrocketing returns associated with zero risks.
• Pressure: They will say that it is “now or never” or it’s for a limited time.
• Affinity group: Some will join your professional or religious group to gain credibility before they offer you their plan.
• Money-back guarantee: They may even say that if you are not satisfied they will give your money back. But it’s actually impossible.

The moral of the story is that if you have any doubt. You should do thorough research. You have to scrutinize everything that has been said to you before signing in to their plan.