The only thing more lacking than Americans' financial literacy rates is their…literacy rates. Schools aren't doing anything to prepare students for the ruthless realities of the financial system, and many parents aren't setting strong examples for their kids.
Savvy financial exploiters have an endless sea of prey to fish from, and these money-making scams and schemes are like Red Tide for the financially illiterate.
“Payday loan” is a synonym for “ultra-short-term loan,” unlike personal loans. These loans come with interest rates that make credit card companies look generous and hidden fees hidden behind more hidden fees.
Payday loans are reserved for the most desperate of the desperate, and payday lenders designed it that way. In the word of Michael Corleone, “Just when I thought I was out, they pull me back in!”
It's tough to fathom, but a large segment of scammers have zero qualms about capitalizing on a hurricane, earthquake, or other disaster. They'll call unsuspecting targets (often senior citizens) posing as representatives of non-profits.
All you have to give them is your credit card info or bank account number, and you can be part of the relief effort! As in granting financial relief to an exploitative scammer.
Fake Job Scams
Scammers will promise unsuspecting suckers the job of their dreams (or at least a better job than McDonald's cashier), knowing countless Americans yearn for greener professional pastures. So you fill out your W-9 form complete with your Social Security number and other sensitive information, and your identity is no longer yours.
The Foreign Love Interest Scam
Lonely people come in all ages, and they're far easier to catfish from 5,000 miles away. Svetlana or Sven, that Eastern beauty or Swedish hunk you've been sending money to? I hate to tell you, but MTV would like to speak with you about being on a TV show. Oh yeah, you'll need to cancel your credit cards, too.
Fake Check Scams
If someone's offer to send you a check feels off, abort the mission. Scammers will have you deposit a check, claim they sent you too much, have you send back the money, then (purposely) let the check bounce. At the end of the rouse, you've sent money to the scammer while receiving nothing.
Unethical Gaming Monetization
Gaming companies have made a killing off of young people and addicts. Loot boxes, skins, and characters are among the ways the financially illiterate, irresponsible, and helpless blow their (and their parents) money in the digital world.
With rare exceptions, multi-level marketing is a Ponzi scheme shrouded in protein powders, cosmetics, or whatever other product those at the top of the pyramid are pushing. Making money is predicated on finding more people to sell the product.
Wait, why do I need to rope other people into selling the supplements? Can't I just sell the supplement? Well, no, because that's not how Ponzi sche—um, multi-level marketing—works.
Mystery Shopper Scams
If someone you know emails you — asking for you to purchase various gift cards — be wary. Call that person on the phone and confirm that they need you to pick up gift cards. Because, in most cases, that's a scammer asking you for the target gift cards.
Many influencers have made a living by projecting realities that aren't there. Like The Wizard of Oz, these savvy con men and women create a world that, when you finally learn the “secrets,” are not what they seem.
Countless graduates of influencers' online courses suffer instant regret. The rest suffer extended-release regret.
Just because it's a money-making scheme “for education” doesn't mean the lottery isn't predatory. You'll read all kinds of pro-lottery articles about how lottery revenues fund senior citizens or national parks, but at what cost?
Robin Hood took from the rich to give to the poor. He didn't take from the poor to give to the parks. That, in a nutshell, is the fundamental problem with the lottery. Those who can least afford to play the lottery play it the most. Are there any other predatory schemes we should add to this list?
So, these are some of the worst money-making scams you should steer clear of. Always look for legit investment and earning ways.
This thread inspired this post.