The Newbie's Guide To Profiting Online Part 5

This is the fifth and final installment of our Newbie's Guide To Profiting Online series.

In this article, we will cover a few final thoughts about how to make sure you are not wasting your time on sites out to scam you for their cash, or worse yet, never profit from them. You have learned valuable lessons from this article so far as to why it is important that you do your homework before investing in any online business opportunity that claims its going to be a quick and easy way for you to make money online. The first two articles covered searching for legit opportunities, with the last one covering finding the right opportunity and its hype surrounding it.

Are you ready for the final piece to making sure you are not wasting your time? Let's get started!

Avoid Online Opportunities for Scams and Time Wasters

Remember how I said you should prepare yourself to let go of your frustrations with online opportunities? It is now time to really let it go so that you can save yourself tons of wasted time. Why do I say this, you ask? Because, as sad as it might be, there are tons of online opportunities being created by less than reputable people just to try and scam people out of their money. In fact, they make quite a bit of money from these scams because many people are too impatient and easily convinced or taken in by them. The following are just a few of the many examples of these scams you might encounter:

1) Pyramid Scheme– This is one of the more popular scams on the web today. A pyramid scheme is one in which the person or company who runs it gets paid for an ongoing stream of money being made, but at some point, when they have financially accrued enough to turn a profit, they will stop. However this happens, they have already profited heavily from "selling" you on something that is not good for you. Here is an example:

This image has been used with permission by The Institute for Underground Economies .

 The Scam: A newbie, not knowing the game, might be persuaded to join the pyramid scheme by some of his/her friends or family members. Once joining, they will make a quick buck for doing very little work. However, once everyone who was in the pyramid has already profited from it, it stops paying its members and basically dies out. Those at the top (those who joined first and got paid first) might even try to continue getting more people involved to keep their scam going on for as long as possible but eventually it will come crashing down (as it always does).

 How To Avoid It: Be aware of this common type of scam that is out there. They are more popular than ever before and can seem very appealing because of the quick money you will make (not to mention how little work you have to do!). Just remember that they will always stop paying you out eventually, so avoid them at all costs.

2) Ponzi Scheme– The ponzi scheme is not much different from the pyramid scheme. In this scheme as well, people will make money off of the investments of others but they still need more and more people to continue making money. Once the schemer has made a certain amount of money, he/she will make a run for it with your money in hand. Here is an example:

This image has been used with permission by The Institute for Underground Economies .

 The Scam: A newbie, not knowing the game, might be persuaded to join the ponzi scheme by some of his/her family members or friends. They are told that the scheme will make them lots of money and also tell them that they are in a group that is "higher up" in the pyramid and are therefore more likely to see profits coming from their investments first.

Conclusion: Since you are getting your money from "higher up" members of the pyramid, this makes it a lot more likely for you to profit, right? Not really! For all intents and purposes, every member of this scheme is getting their money from other members, so no matter how much higher "you" are in the scheme, you cannot see any profit for yourself. Once the ponzi scheme is finished paying off its early investors (usually after about six to twelve months), it collapses and everyone involved loses their money.