The rich get to go to interesting investment courses. I am going to give you a glimpse into one of them and tell you the ups and downs of pay-day loans.
I attended a millionaire investment course where about 1000 people were there. We all paid a bunch of money to have people pitch their investments to us, all of which claimed to give above average returns. My accountant and I listened carefully to each one. Then we approached some of the speakers to do more inquiry on their topic.
The line up to talk to the pay-day loan guy was around the corner. What is a pay-day loan? It is a service where you can go and cash a cheque or get a short term loan against your paycheck, some also do foreign exchange and money transfers. They charge a service fee and interest. They are a semi legal printing press for money as far as I can tell.
These places make so much money I could not believe they were at this conference asking for money. I figured what the heck would have need my money for? He told us the demand was so great he just did not have enough money. If he had another million dollars it would be in these short-term loans tomorrow! Well get your calculators out, they charge 28% + and do not forget the service charge. It is so close to being loan sharking I can not believe it is allowed.
My accountant and I got the whole pitch, we would earn 45% return per year on our investment (that is a huge amount), minimum $ 100,000.00 investment required. "There has not been a store in the chain that has ever lost money," he boasted. Lost money! I asked, "Has their been a store that has gotten less than a 200% return for them?" He declined to answer that, but doing the math it is more than likely they do better than that.
The numbers on this stuff is mind boggling. We went home and in the next month I happened to meet a person, at a business social, working in a payday loan place. He was a young man in his 20's, getting a little above minimum wage. I bought him a couple of drinks and the information started flowing out. Their client list looked like a roster of available jobs in the world. Meaning who is using these places, EVERYBODY! I mean from lawyers, doctors, accountants, truck drivers, ditch diggers, you name it they got it.
What it means is many people can not make it from paycheck to paycheck. Okay what does that mean, they are spending too much money each month. On what? Again you name it and there is being money spent on it. Hey folks, do whatever you can to never use a place like this. Do what it takes to get your spending under control, search out some of my other articles on various techniques to do it. If you are using a pay-day loan type place that is a screaming signal you need to change what you are doing financially.
I said I would say the ups and downs of pay-day loans. Well the downs are all for the customer and the ups are all for the owners of the business. If you are using these places, do yourself the favor of reaching out for debt counseling. Get in front of someone and ask for help and do it.
Many of you will ask if I put in the $ 100,000.00. No. Some of my wealthy friends would not agree with me on this but there are lots of ways to make good money but not on the backs of other people. I think these types of businesses are destroying people's lives, they some may not agree with me. Do yourself a favor and never use a Payday Loan service. Be smart to be wealthy.