Pyramid Schemes Will Make You Lose Your Money

Pyramid Schemes Will Make You Lose Your Money

Around the age of 18 to 22, you have definitely been approached by a person that is there to suggest a new way for you to make money. They are talking to you about the company that does nothing more than investing and, if you don’t company you’re going to be making massive amounts of money in no time.

It Starts with Small Investments

All the tell you is that, the only thing you have to do is invest a specific amount of money and then simply get people into the company and ask them to invest as well. The more people you recruit in the company the more money you are going to be making.

This is a pyramid scheme and the basic way to understand how pyramid schemes work is to simply try and understand that the top of the pyramid is always the person who is going to be winning the most.

You Need to Always Recruit People

To make money in a pyramid scheme you need to constantly recruit other people in order for those people to recruit others and those people to recruit others. But wait, there is a constant cash flow coming in the pyramid and a small percentage of that goes to you.

However, if the first 10 people you recruit, invest once and then never recruit again, this is not something beneficial for you. Therefore, you will need to convince them to investigate in order for you to continue the cash flow towards you.

You’re Making Money for Others

The people above you in the pyramid will try to do the same thing to you which means that, in order for you to have a cash flow coming towards you will need to always invest. In most cases, if we are talking about a very large pyramid, the interest you are going to be making is going to be very low.

In other words, if you’re in the pyramid and you have at least two people of all you then you might be making some money but if you have more than five or six people, making money is going to be really hard. On the contrary, you will end up losing money.

This Is an Illegal Business

What you need to know is that, joining a pyramid scheme or trying to recruit others is actually considered to be illegal. In other words, not only are you going to be risking losing your money but you might also go to prison for being part of that scheme. This should get you thinking twice before you say yes to joining the pyramid.