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Looks Like We Have a Comedian: Get Rich Quick Schemes
The old adage “if it sounds too good to be true, it probably is” is unfortunately, well, true. As we look to make the most of what we’ve been given, the average person will be offered multiple chances at “million dollar opportunities that will change your life and set you free.” We Americans love a good chance to take charge of our lives through financial upward mobility. Who doesn’t want the time and money to be their own boss, travel the world at will, have time for loved ones, and complete their bucket list? Most get rich quick schemes prey on these desires, promising to give you everything you want and more.
Here are some classic get rich quick schemes:
- Multi-level Marketing (MLM) or pyramid schemes
- Investment scams promising high returns quickly for little money
- Debt relief or credit repair scams
- Fake job listings
- Lottery scams
- Student loan forgiveness scams
- “Nigerian Prince” schemes
- Ponzi schemes
Unfortunately many people have lost a lot of time and money to these kinds of schemes. Promises to get rich quick are not all as schemey or outright scams like these examples. Many are hard to detect, so much so that the FTC has launched investigations into identifying these schemes. A lot of pitches to get wealthy quickly are more subtle or sound more sophisticated.
Jokes on You: Why Do Get Rich Quick Schemes Fail?
So often they promise you money for nothing, or nearly nothing. Sadly, (buzzkill, I know) NOTHING, especially money, is free. A lot of schemes would like you to believe this. Unfortunately, most get rich quick schemes are at best misguided and at worst sinister. In the worst get rich quick schemes, you, the person offered a chance to make millions, become an unsuspecting tool to make the schemer money.
These get rich quick schemes typically require an upfront investment (membership fee, required initial investment, payment for the first round of merchandise you sell for an MLM) that will at best give you minimal returns, or at worst none at all. Before you make any investment, make sure you thoroughly understand what you are investing in, and know legally what returns you are entitled to as an investor.
Another reason fast money schemes fail is they are simply poor plans to grow wealth. For example, while NFT trading may one day be a viable wealth building strategy, you probably won’t strike gold from selling virtual trading cards, despite what some may tell you. Most get rich quick schemes lack vision. They promise you success, freedom, and wealth without the failure, adversity, and sacrifice it takes to achieve those things.
Also bewere of traditional investments being pitched as strategies to get rich quickly. While day trading stocks, bonds, or crypto currencies can make you rich overnight, striking gold from investing in specific securities or currency is far from guaranteed. Speaking generally, you have about as much control over a single investment in a security or currency making you rich as winning the lottery. Anyone who makes a living off their investments needs deep knowledge, diversification, patience, and a hard work ethic to build real wealth.
Wealth building is a long term commitment that requires dedication to your craft. Even if one of these schemes is remotely profitable for you, you also need to consider the opportunity cost of your time. The hours you spend trying to convince your grandmother to buy your Multilevel-Marketing product could just as easily be used to find a real estate deal that has a much better potential rate of return, and has lasting value.
No Kidding: The Slow Grind for Real Wealth
Anyone looking to grow wealth must make sacrifices. One of those sacrifices is instant gratification. This sacrifice is a hard one because our TikTok wired brains are always looking for the next hit of dopamine. Building real sustainable wealth takes planning, persistence, and patience, which we aren’t always great at. To grow wealth, taking the time to do your own research and sit down with professionals to create a plan is a necessity. To carry out that wealth building plan, you’ll need persistent effort to make financially conscious decisions day in and day out. Finally, building wealth takes patience, being content with waiting for high gains in the long term.
The Punchline: Real Estate - An Excellent Wealth Building Plan
Real estate investing is a lucrative wealth building plan--but like anything worth doing, it takes time, dedication, and a willingness to learn from setbacks. The good news is real estate is actually one of the quickest ways to build real, stable wealth. Proper management of real estate can turn a modest amount of invested money and a lot of hard work into a source of regular “passive” income and a concrete appreciating asset that is known to hold value over time.
You do not have to lock your money away in a 401k for forty years before you see it grow (though we do recommend contributing to a 401k if you have it). If you're willing to do your research and work hard, appreciating, income producing investments are one of the best benefits of real estate.
Real estate can propel you forward on the wealth building journey in ways that other asset classes can't, and certainly get rich quick schemes can't.
Conclusion: No Jokes Here
If you’re like most new investors, there’s a good chance you don’t have the time or money or patience to BRRR (Buy, Renovate, Refinance, Repeat) your own real estate properties. Fortunately, we here at Birgo and Reiturn have created a real estate private equity fund and a REIT to give any kind of investor, large or small, young or old, an opportunity to build real wealth through real estate. Not only do we provide investment opportunities, but a community of real estate professionals and enthusiasts who want to see new investors not only grow their portfolios but their real estate knowledge as well.
For REI beta and a general good time, stay tuned to our Insights.