Tuesday, September 17, 2013

How To Get Rich - Avoid Investment Scams

Do you think everyone who promotes investments is honest ?

Do you think others will always look out for your best interests ?

The sad answer in NO, many focus on their own greed first !

Greed Promotes Corruption

The sad truth is that wherever there is money there is an influx of greedy individuals looking to capitalize in whatever way they can. This includes shady or downright dishonest individuals that simply do not care who they hurt in order to satisfy their wants.

It is human nature that everyone wants more out of life. Everyone will develop different ways to try and achieve this desire and some will choose a life of dishonest or even criminal activities. Luckily the vast majority of individuals are honest, but how do you know which ones are not ? How do you avoid the smooth talking shady individuals ?

Beware Promises of Huge Gains

The shady individuals tend to play on the prospects' own individual greed. They look for individuals who want to make a fast buck and focus strictly on promoting huge gains if one were to invest. Their target prospect is one who has some money and a strong desire to make a big investment windfall in order to brag to their friends. These prospects are most often either desperate or simply uneducated to investing.

It is possible to make huge gains on an investment. However, with that potentially huge gain there has almost always been an equal if not greater degree of huge potential risk. A simple rule of thumb should be " the bigger the stated gain the more you should investigate all details of the investment" . Another even simpler rule would be to avoid these big gain promises all together. The odds of it being a scam are much, much greater.  

Always Have A Way Out

When investing, you should always know your exit plan before you enter into any investment. Things do not always work out as you plan and you need to have a fast way out in order to limit potential losses.

A dishonest investment promoter will almost always leave you with very poor options for getting out if you have to. In many cases, the investor will have to find their own buyer. This is a situation you want to avoid.

If the promoter is playing down your concern to have an exit strategy, then you simply need to exit the meeting and look elsewhere.

What To Do

To avoid most scams you should be wary of promises of huge gains. Remember, the bigger the potential gain, the bigger the potential risk.

Also, always, always. always know your exit plan before investing in anything. Only invest in investments with good markets to sell into if you must. Otherwise, you could be stuck with a bad investment for a very long time. Remember, you are investing to make money. Period. No other reason qualifies.

As always, I welcome your comments and suggestions for future topics.

1 comment:

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