AVOID PYRAMIDS AND GET RICH QUICK SCHEMES

When I was 14 years old, a friend of the family approached me about selling soap. It was called Zif. As he explained how it worked, I thought it sounded pretty good. I paid him $12 for a starter kit, and then hit the streets selling soap. The real money, however, was if I could get others to sign up. I would get a percentage of their start up money, as well as part of their soap sales, and those under them, and those under them etc. I lasted two days. I decided I wasn't a salesman. I didn't know it at the time, but that was my first exposure to pyramid sales.

With pyramids, the people who get in first make the money. This type of marketing is still around in many forms. Another name for it is multi-level marketing. When I was a young adult, Amway was big. The appeal was always about how much money you could make, or how you could own your own business. In my opinion, if you want to be a business owner, choose a legitimate career.

However, there are much worse critters out there, called get rich quick schemes. These will suck out all your blood and leave you dead on the highway. They appeal in a very base way to human greed. As my dad used to say, if it sounds too good to be true, it usually is.

My sister lives in a small Colorado town. A man came through selling investment opportunities. It was very convincing, especially since so many townsfolk were signing up. In the end, many lost their entire life savings. The greatest danger is in thinking that it can't happen to me, because I'm too smart.

Some of the sharpest minds in the financial world let themselves be taken in by Bernie Madoff. It seems like every week I read similar articles of innocent people losing their retirement savings. A friend of mine heard about a glowing investment opportunity on Christian radio. He lost all his retirement ($200,000) and owes the I.R.S. $10,000.

There is a lesson here for all. Be very careful. Make sure they are not appealing to your greed. Be aware of investments that put time constraints on you. Make sure they are licensed with your state. All companies and representatives selling securities are required to have a securities license in their state. Take a look at the overall picture. As I said previously, if it is sounds too good to be true, it usually is.