5 ‘Make Money Online’ Scams to Watch Out For: How to Avoid Rip-Offs and Actually Make Money Online
Make Money Online Scams
There are few things that people chase more in this modern age than money. It’s not even that we’re necessarily greedy; it’s natural to want an easier solution to all of life’s financial problems.
What if you could work in your pajamas? What if you could wipe out all of your debt with a high-paying job that requires little education? What if you could be the envy of the neighborhood with your new fancy car?
Surprisingly, this is actually possible. It takes a lot of work, though–more work than most people are wiling to do. In addition, you’ll have to swim through a sea of scammers who are trying to sell you on a dream.
When you’re first looking into making money online, you may not know who to believe, so take a look at these common scams first before you dive in. I will also offer some alternatives below each one that actually can make you money:
Scam #1: Multi-Level Marketing
Multi-level marketing (or MLM) is actually an ancient scam that has recently had an explosion in popularity thanks to the internet. You might have heard it referred to by a few names and euphemisms, such as “network marketing.” Though I would hesitate to say that all MLMs are 100% a scam, most of them are at the very least a bad business idea and at worst an all-out con.
What is multi-level marketing? Well, it all starts when you see an ad online or are even contacted by a friend. Either way, someone has an “exciting business opportunity” for you.
The way the business works is that you peddle an overpriced product and also try to recruit people to work under you. You make a percentage of what your recruits make, and a percentage of what their recruits make, and so on. All you have to do is buy a huge starter kit for hundreds of dollars and keep buying a steady supply of the product from month to month.
Pretty soon, you’ll have dozens of minions working for you and all you’ll have to do is sit back and drink your margaritas on the beach. As long as you’re at the top of the pyramid, life is good.
Wait, what? A pyramid?
Yes, that’s right. Nearly all MLM businesses are little more than disguised pyramid schemes. The products are overpriced and you’ll find yourself having to struggle to sell them to your friends and family. Worse still, you have to put up a bunch of money upfront to get into the business.
Many MLMs will emphasize the idea of “recruiting” people so that you can make tons of money from the people under you, but that is basically a Ponzi scheme. You’re making money from these people buying your overpriced starter kit, and they’re making money from people below them doing the same. Eventually, the system implodes if there’s no actual good product, or the product is overpriced (which it usually is).
Even if you can make some money from a specific MLM (which is rare, but I have seen people do it), it is not the ideal place to put all of your efforts. Why? It’s not a long-term sustainable business that you own. You are putting all that energy into getting customers for someone else. With an MLM, you don’t have the freedom that comes with a real business:
- You are tied to one supplier, so you can’t change manufacturers to save money or improve quality.
- Prices for the “wholesale” product are often inflated, so your profit margins will be low.
- You are limited to the line of products that the MLM provides.
- You are competing directly with other people who are selling the same exact thing to the same exact audience? Why would your friend buy from you when Joe Blow also sells the same exact brand of makeup for the same price with the same sales material?
- You will never have your own brand.
If you want to build a real business, then you need more control. You could potentially make a lot more money selling your own products. The learning curve is definitely more steep, but that’s the price you pay for something that might actually be worth the effort.
A Legit Way to Actually Make Money Online Instead: Sell Private Label Products
If you’re already willing to put up an investment of hundreds or thousands for an MLM “starter kit,” then you might as well spend that money on something that can actually make you hundreds and thousands per month back.
Private labeling is when you make your own brand of product, buy cheap from a manufacturer (usually overseas), and sell it for a profit to end users. By cutting out the middle man and all the BS that goes with MLM, your margins will be much, much higher.
Obviously, this takes a lot more thought than joining an MLM does. You need to do research and learn from your early mistakes. You would probably do well to buy some training on the basics, but most of what you will learn will be from trial and error. This can be a scary thought and it may not seem so appealing in the face of an MLM company that seems to have all the answers.
The truth is, though, by getting into private label products:
- You truly own your own business.
- You own your own brand.
- You have control over the supplier.
- You have control over nearly every aspect of the product.
- You decide what your prices are.
- You decide what direction you want to go in.
These days it’s easier than ever to get in touch with a factory and have your product built from the ground up. It doesn’t have to be complicated. You don’t even have to sell on your own website at first. Amazon and Ebay can be great places to start. Just make sure to do market research before you spend money on anything.