I just read a scathing article about MLMs (multi-level marketing companies) like LuLaRoe, Rodan & Fields, and Amway. The gist is that the MLM business model—which propagates itself in part by encouraging sellers to recruit other sellers from whom those upstream take a cut of the profits—dances very near the line that separates a legitimate sales enterprise from a pyramid or Ponzi scheme.
If there is only one thing I can successfully knead like yeast into the bread dough of my children’s financial acumen, here it is:
EVERYONE wants your money.
When friends invite me to their homes for candle, book, lingerie, bag, kitchenware, or whatever parties, it is not because they like to hang out with me, or because they hope their products will enhance my life. It’s because they want to make sales, and they are capitalizing on the currency of our friendship and the cultural norms of social relationships in order to do so.
There’s nothing inherently wrong with that, but it’s important to my own financial well-being that I understand it. Otherwise I will find myself monetarily supporting every person who asks me to chuck some funds his/her way. If I like the product, I go to the party fully intending to buy something as I am expected to do. If I don’t, I decline the invitation.
Your employer wants your money, too. She wants to pay you as little as possible, while getting as much value from you as she can. The more talent/skill/education/experience you bring to the table, the better off you’ll be in the salary and benefits negotiation, but make no mistake: your boss would gladly pay you half what she does if she could get away with it.
GoFundMe and the like annoy the heck out of my penny-pinching self with their bald-faced grabbiness. But at least these folks are refreshingly up-front, right? “Not even going to try to make you think you’re getting anything out of this transaction. Just give me your money.” And a whole lotta people do.
Do you know why your favorite stores move things so often? It’s not because they need to keep their staff busy, nor is it just to improve the aesthetics of the place. It’s because when you wander around trying to find the thing you came in for, you’ll happen across stuff you didn’t know you wanted till you saw it. Impulse buys are gold for retailers. And they cleverly put items to tempt children (sugary cereal, toys, candy) at knee-level and below, because when your kid is having a full-on meltdown in the middle of the aisle, marketers know that nine times out of ten you’ll buy the little tyrant anything just to shut him up and get other shoppers to stop giving you the hairy eyeball.
It’s all about separating you from your money.
All of it.
Everyone wants your money. Life coaches, consultants, photographers, artists, doctors, landscapers, lifeguards, performers, event planners… they all want your money. They may love what they do and genuinely long to do what they do for the benefit of others and of society. But not without remuneration. To quote the Joker (the Heath Ledger version), “When you’re good at something you don’t do it for free.”
If providers give free samples or free estimates or free goodies, they’re doing so not because they love and care about you but because, like drug dealers, they’re hoping they’ll hook you and you’ll pay them to give you more.
Every single advertisement you’ve ever seen, heard, or read was created with the sole purpose of convincing you to hand over your cash to the maker of the product or provider of the service. And marketers generally try to do so by getting you to think about how your life isn’t as special and wonderful as the lives of those who have that thing.
Think about that.
A friend of mine refuses to teach her kids about money because, “Money is dirty, and I don’t want them to deal with it until they have to.”
I disagree. Money’s not dirty. Money’s just a thing, a tool for living. Financial success or failure comes down to one very simple formula that even a fourth-grader can grasp:
What Comes In minus What Goes Out equals either a positive or a negative number.
What Comes In is what you earn or receive. For most of us that tends to come from only one or two sources: job income and possibly inheritance or gifts from parents/grandparents.
What Goes Out is every single item you spend money on all day, every day: groceries, eating out, your cable bill, Starbucks, postage stamps, new shoes, gas, insurance, a mani/pedi, concert tickets—all that stuff you need and all that stuff you want. You get bombarded every day and everywhere with ask-messages from people who want you to give them your What Goes Out.
Everyone wants your money.
That sounds cold, hard, and cynical, I know. And I’m sorry if I’m breaking your heart. But not knowing this basic truth will break your bank, if it hasn’t already. Ignorance of the foundational greediness of business leads to doe-eyed dreamers falling for get-rich-quick charlatans and too-good-to-be-true schemes.
And don’t even get me started on the lottery, which is essentially a tax on people who can’t do math.
Those who get in on the ground floor of shady businesses often do clean up. But they do so on the backs of those who come after them, who frequently end up losing hundreds or thousands of dollars chasing the wind. (Congrats on your success, Money-Grubbers; I hope karma bites you in the butt for financially devastating other people to get you there.)
Everyone wants your money, friend. Remember that next time someone offers you a deal that’s too good to miss out on.
Because the only deal that’s truly too good to miss is the one where you walk away with your money still safely in your fist.