Tuesday, October 28, 2008

Too Good to Be True

The adage, "If it seems too good to be true, it probably is" seems as appropriate today as ever. In the now-now-now microwave culture of the United States, we are inundated with emails, infomercials, phone calls, flyers, and even "new friends" wanting to share get rich quick schemes. A few years ago, some good friends of ours met such a new friend who invited them to a "dinner" which turned out to be a few snacks and a sales pitch for a pyramid scheme. We went along (I had no idea it was not actually just dinner until we got there), and I sized it up for them.

"What these people are doing is making it sound fun and exciting for you to join so they can make money off of you." My poor friends were sure I was wrong, but then I explained the nature of what they were asking me to believe. The scheme: get a bunch of friends to buy their groceries through this service instead of the grocery store. By buying through this service, members get paid as a "thank you" for not making the service use funds to advertise.

No one is getting rich from buying their own groceries. Someone who has hundreds of people buying groceries that way might be making a nice profit off such a scheme, but the people at the bottom are probably making nothing - if not losing money.

Such is the way of almost any get rich quick scheme. It does someone rich: the person selling it. In the midst of an economic downturn, many people get drawn in to trying these things simply because they're hoping to find a new bucket to bail water out of the sinking financial ship. What they often find instead is that they have pulled the plug and sunk it instead.

My advice to anyone considering a new idea on how to make money: sleep on it and pray about it. If the person shilling the idea can't wait for a day or two, then something is going on. My wife and I made the commitment several years ago that we would sleep on any major decision about money after we let ourselves get sucked in to a bad car deal. We have rarely regretted our choices since that time.

-- Robert

4 comments:

Melissa said...

Groceries? Seriously? Wow...

And yet so many people fall for it. At least your friends were smart enough to ask for advice first. Sheesh...

Robert said...

This couple gave an inspirational talk about taking four-wheelers into the mountains with their fancy sleeping-bag-hammocks... as a way to help people realize what they could look forward to when the scheme made them rich....

le35 said...

Well, I'm glad we slept on John Beck first, but all in all, I am glad that we're finally getting training on something they actually pitched us on. . .

Robert said...

I wasn't really thinking about that one when I started writing this post. I was thinking about something else entirely... and now whatever it was has completely slipped my mind. I was only partly thinking of our friends who were recruited by the pyramid scheme. I might've been thinking about some Dave Ramsey comments, though.