With the wealth gap growing constantly and real estate prices reaching impossible levels in many places, some feel their only chance at becoming wealthy is to hit the jackpot.
Also, with today’s technology and its constant dopamine feedback loop, many have lost patience for the monotonous ways of doing things, including work, savings, and investing.
Consequently, some people don’t have the patience for the steady and safe way of investing in the stock market or real estate, and look for shortcuts and fall prey to “get rich quick” schemes.
In this article, we’ll review a few of them and what you should look for.
Crypto Scams
For several reasons, today’s most popular scams are in crypto. First, it’s a hot space, with stories of people getting rich by buying Bitcoin when nobody heard of it and making a fortune. Second, it’s a global phenomenon with no regulations, so scammers can easily reach their victims and rarely face legal consequences.
The most popular crypto scam is pump-and-dump: people with visibility create a coin, sometimes attached to an internet meme, which they advertise as “going to the moon” and entice people to invest (this is the “pump” part); as soon as investors start buying, the price starts going up, and the insiders start selling right away (this is the “dump” part).
One misconception is that only people who do not realize it’s a pump-and-dump fall prey to this. In most cases, people “investing” in these coins suspect it’s a scheme but think they can get in early and exit before things fall apart. However, when outsiders hear about the coin and notice its rise, the insiders are already dumping it.
Other schemes involve stealing data or crypto funds by hacking or phishing schemes, including fake crypto exchanges or wallets. It’s a risky sector and vigilance is essential.
Stock influencer schemes
Similar to the crypto pump-and-dumps, there are also cases where stocks are being pumped. Although the stock and company are genuine and not scams, influencers are paid (cash or stock) to promote the stock as investment advice so that its price rises as retail investors enter while insiders exit. So beware of any investment advice into lesser-known companies, advertising high target prices, or their excellent fundamentals.
Stock signal services
Signal services are private groups offering stock investment advice for a monthly subscription. They advertise investment advice that results in record earnings for the members of the groups; however, their results are, at best, average but most often losing due to the excessive risk they recommend taking. Ask yourself: if you would hold the secret to reliably generate the returns they’re advertising, would you spend time selling those secrets for $100/mo? You wouldn’t, and neither would they; their profit is the money they’re charging the members of that service.
Real estate scams
Unless your market is well-regulated, watch out for real estate investments that ask for a sizable advance payment for a property to be built in the future. The discounts can be attractive, but there are significant risks: the project can fail and not deliver the property, be delayed beyond the original term, or deliver below the promises.
Self-help courses
This is not a scam in the traditional sense, like the topics above, but it still is selling you a dream that is not real.
Expensive courses promise to improve you in sales and business and make you successful. Still, you can often extract the same value from free or cheaper options. You don’t need to spend $2000 for a Diamond VIP ticket to learn how to be a better salesperson or grow your business when you can get the same or better information from books and freely available interviews.
Mentorship can be extremely valuable, but these paid courses rarely offer real mentorship. You’re much more likely to get that from attending free meet-ups and conferences or connecting with experienced entrepreneurs.
If millionaires offer paid courses, their business is these courses.
Conclusion
In conclusion, if you want to get rich and build wealth, follow the patient path: save with discipline, invest safely, and make your wealth over time.
Anything promising to make you reach quickly will likely make you lose everything.