What is a Pyramid Scheme?

What is a Pyramid Scheme?

By Brad Schneider

http://www.bradsblog.net

Most people these days have heard of the term "Pyramid Scheme", but not everyone knows quite what the term refers to. Pyramids are businesses that involve earning money from those who are beneath you in the pyramid. Many of these businesses are perfectly legitimate, and one can be quite successful without recruiting anyone else.

There are many businesses that you might be familiar with that are pyramids, including:

Tupperware

Mary Kay

Amway

Quickstar

Creative Memories

Stampin' Up!

The "Bad" ones are those that will not make you money unless you recruit more and more people. These are the schemes that bring the bad name to the business, and are otherwise referred to as "Pyramid Scams". If and when you are approached to be recruited, you should ask the hard questions. Be sure to ask how much money you make without any recruits. Also find out how long they have been affiliated with the program, and how many recruits they have underneath them.

The only time I would recommend getting involved with one of these pyramid type businesses is where you make regular purchases and you enjoy dealing with a certain product (Such as Mary Kay, Stampin' Up!, etc.)

Brad Schneider writes financial and blog related articles for his blog as well as www.blog-hints.com and www.investingpub.com

This article is copyright © 2005 www.bradsblog.net and is free to distribute as long as this copyright statement and all links and text are included.