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Sounds like MLM but okay · She's On The Money

0:00
Speaker 1: She's on the Money.
0:02
Speaker 2: She's on the Money. Hello, and welcome to She Is
0:14
Speaker 2: on the Money, the podcast for millennials who want financial freedom.
0:18
Speaker 2: My name is Georgia King. I'm a copywriter and journalism
0:20
Speaker 2: student who knows a little bit about the wonderful world
0:22
Speaker 2: of money now, but I still have lots left to learn. Luckily,
0:25
Speaker 2: just like all of the weeks always, I am joined
0:28
Speaker 2: by Millennial Money. Were's Victoria Devine. Hello, good morning, Georgia King.
0:32
Speaker 2: Now today on the show, we are going to be
0:34
Speaker 2: dissecting the problems with MLMs, or multi level marketing businesses
0:38
Speaker 2: as they're also known. You've probably heard of them before.
0:41
Speaker 2: They're the network marketing companies that on board you to
0:43
Speaker 2: make money by selling their product and also by recruiting
0:46
Speaker 2: others to join your team, who then sell that product too.
0:49
Speaker 2: Examples of companies that use this business model include Tupperware,
0:53
Speaker 2: do Terra, Lularo, and plenty more. Research out of the
0:56
Speaker 2: US has also revealed that ninety nine percent of all
0:59
Speaker 2: MS distributors lose money. So we think it's time we
1:03
Speaker 2: had a chat. But before we dive in and dissect
1:06
Speaker 2: hy MLMs are maybe not quite as they same. Victoria
1:09
Speaker 2: let's start on a peppier note and chat through some
1:11
Speaker 2: money wins or confessions from the week. That was, what
1:14
Speaker 2: have you got for me?
1:14
Speaker 1: Okay, I have another money win. They are coming at
1:17
Speaker 1: you left, right and Santa, Yes, you are welcome. Mine
1:22
Speaker 1: is a food related money win. I feel like a
1:24
Speaker 1: lot is either food or car relationships. Okay, but that's
1:28
Speaker 1: where I'm at in my life. So, Georgia, as you know,
1:31
Speaker 1: I'm probably one of the most digestively challenged people.
1:34
Speaker 2: I can confirm this.
1:35
Speaker 1: Yeah, so it's not easy for me to find snacks
1:39
Speaker 1: and foods that actually align to all of the requirements
1:42
Speaker 1: I have. And recently, my local cafe has been dabbling
1:45
Speaker 1: in making some snacks, muffins and things that actually meet
1:49
Speaker 1: my requirements. Not for me, it's for everybody. But I'm
1:52
Speaker 1: really excited about it. So I let them know and
1:54
Speaker 1: this morning they sent me home with a free muffin
1:57
Speaker 1: and I was very excited about that. It was a
2:00
Speaker 1: delicious raspberry I think pretend white chocolate muffin. I call
2:03
Speaker 1: it vegan yay. So it was like gluten free, vegan,
2:06
Speaker 1: dairy free, all of those that I consume, and I
2:10
Speaker 1: loved it. So anyway, those things are usually really expensive
2:13
Speaker 1: and I'm here for it, so that was my money win.
2:15
Speaker 1: It's about a muffin. Do you have a good money
2:17
Speaker 1: win for me?
2:17
Speaker 2: Georgia Ka. Mine is also food related and it's not vegan.
2:21
Speaker 2: In fact, it is quite the opposite. You guys might
2:24
Speaker 2: remember in season two I dropped a little shout out
2:26
Speaker 2: to my mates at Aldie. Still isn't about che fan,
2:30
Speaker 2: It's not about tuna this time, it's about cheese, guys. Now,
2:33
Speaker 2: I'm a big cheese girl. My friends listening will know
2:37
Speaker 2: this already, but dafen Wire is my favorite cheese, triple
2:39
Speaker 2: cream Bree. But it's gonna set you back out. It's
2:41
Speaker 2: gonna set you back about fifteen bucks apart, it's not
2:43
Speaker 2: even fifteen.
2:44
Speaker 1: I think it's more expensive. I posted to the city
2:47
Speaker 1: like it's like eighteen dollars. I think a.
2:49
Speaker 2: Slumt yeah, which is ridiculous, but I'm gonna say it's
2:51
Speaker 2: worth it than a lance to my values. But recently
2:54
Speaker 2: I went to ald and they have this whole cheese range. Guys.
2:57
Speaker 2: I'm talking truffle Bree. I'm talking triple cream Bree, all
3:00
Speaker 2: of the brizl of the cameabis, they have amazing choices
3:05
Speaker 2: for like, you know, a core of the price impressive.
3:08
Speaker 1: I like your paving kim accent.
3:10
Speaker 2: Yeah, I don't know why. No, I'm just excited about
3:13
Speaker 2: the cheese. Anyway, get around to gus.
3:15
Speaker 1: She'd say that to your money when this week you
3:17
Speaker 1: bought some cheese.
3:18
Speaker 2: Yeah, but I saved like fifteen bucks. Okay, all right,
3:21
Speaker 2: that touched my win.
3:22
Speaker 1: I'm not judging your win.
3:23
Speaker 2: Well, okay, so mine wasn't that impressive. But you know
3:26
Speaker 2: who's always impressive. Our Facebook group. That let's have a
3:29
Speaker 2: little look at the community, the small community of eighty
3:32
Speaker 2: three thousand people. Now, if you don't mind, Victoria, which
3:35
Speaker 2: post stood out to you this week?
3:36
Speaker 1: Georgia King, I have a money win this week from
3:39
Speaker 1: the Facebook group. That made me stupidly happy, and I
3:43
Speaker 1: think it made a lot of other people really happy
3:44
Speaker 1: as well, judging on how many likes and interactions this
3:47
Speaker 1: post got. So this was from Sealy and she said
3:50
Speaker 1: today I paid off a personal loan from my first car,
3:53
Speaker 1: which was a complete Lemon. I've had the loan since
3:56
Speaker 1: I was a fresh eighteen year old and it was
3:58
Speaker 1: a fourteen percent interest. Straight had the car for one
4:00
Speaker 1: year when the car died about two years ago, I
4:03
Speaker 1: was left with a massive loan to pay off and
4:05
Speaker 1: no car. So this year she paid off over eight
4:08
Speaker 1: thousand dollars worth of debt, including her personal loan and
4:10
Speaker 1: credit card, and she's finally feeling so much better about
4:13
Speaker 1: her financial health, which, as you know, Georgia is my
4:16
Speaker 1: favorite of helping people. And she said that I've listened
4:19
Speaker 1: to the podcast and something that really struck with her
4:21
Speaker 1: was if you live fakeriage now, you'll be real poor later.
4:24
Speaker 1: And she said that she'd been doing this her whole
4:26
Speaker 1: adult life, trying to prove to people that didn't matter
4:29
Speaker 1: to her that her work as a human amounted to
4:31
Speaker 1: a fancy car and fancy clothes. So while that's all
4:35
Speaker 1: stupidly impressive, the other money in that she had for
4:38
Speaker 1: us was that two months ago she bought her first
4:41
Speaker 1: house with her partner, and she'd saved for the deposit
4:44
Speaker 1: for the house while paying off her debts. And she
4:46
Speaker 1: says that the podcast has changed her life. Ah, I
4:49
Speaker 1: gets so sappy about all of this, but Ceely, you
4:52
Speaker 1: are a legend. And the photo of you and your
4:54
Speaker 1: partner out the front of your house with this sold
4:56
Speaker 1: sticker makes me so happy. Let's see more of these
4:59
Speaker 1: type of posts in the group. Georgia King, have you
5:02
Speaker 1: got a post that stood out to you this week?
5:04
Speaker 2: I certainly do. Minus from Aste, who has written in
5:09
Speaker 2: that she's recently been stalking the old Facebook marketplace. Yes, yeah,
5:14
Speaker 2: and she was. She was in the market for a
5:17
Speaker 2: Brevel coffee machine or any kind of professional looking comfy shows.
5:19
Speaker 1: One's really popular, aren't they They are?
5:21
Speaker 2: And you know what, they can be expensive seven hundred,
5:23
Speaker 2: eight hundred dollars usually she picked one up for a
5:27
Speaker 2: hot three hundred dollars, So she's frothen up those barista
5:31
Speaker 2: made coffees on the daily. Forget your four dollar fifty
5:34
Speaker 2: latte in the morning five dollars if you're having oat
5:37
Speaker 2: milk like Victoria, she's having them at home for free.
5:39
Speaker 2: So good on you, asty, and also good for the
5:42
Speaker 2: espresso martinis.
5:43
Speaker 1: Yea, I was going to say, can you make sure
5:45
Speaker 1: that you talk about the edit that I can see there.
5:47
Speaker 1: She says that she's worked out how to perfect the
5:50
Speaker 1: espresso martini also in lockdown, So I just feel like
5:53
Speaker 1: that's the money when all around, because let's be honest,
5:56
Speaker 1: an espresso martini can set you back a solid twenty dollars.
6:00
Speaker 2: Yeah, and you can't go out now, so may as
6:02
Speaker 2: well stay at home and enjoy those espresso Martin's. All right, now,
6:06
Speaker 2: let's move on to the main topic of today's show,
6:08
Speaker 2: multi level marketing.
6:09
Speaker 1: Now.
6:09
Speaker 2: Globally, MLMs are a multi billion dollar industry with hundreds
6:13
Speaker 2: of thousands of people being tied to these companies who
6:16
Speaker 2: promise the world that more often than not, do not deliver.
6:19
Speaker 2: MLMs are often sold to people with the lure of
6:21
Speaker 2: being an easy way to be our own bus and
6:24
Speaker 2: make bank from home, which sounds too good to be
6:26
Speaker 2: true because usually it is.
6:28
Speaker 1: How is the emphasis there? Now?
6:29
Speaker 2: MLMs are often sold to people with the lure of
6:32
Speaker 2: being an easy way to be our own bus babe
6:34
Speaker 2: and make bank from home, which sounds too good to
6:36
Speaker 2: be true because usually it is.
6:39
Speaker 1: Now.
6:39
Speaker 2: Unfortunately, it also impacts significantly more women than men, with
6:43
Speaker 2: seventy five percent of distributors or MLM salespeople being women.
6:47
Speaker 2: So what better place to talk about it than right here? Victoria,
6:51
Speaker 2: please kick us off by further clarifying exactly what MLMs
6:54
Speaker 2: are them can move into why they are so very problematic?
6:57
Speaker 2: If that suits you, it absolutely suits me. So first
7:00
Speaker 2: things first, I know we're going to get a lot
7:02
Speaker 2: of people offside with this episode, but I think it's
7:05
Speaker 2: really important to discuss it, and once we get through
7:08
Speaker 2: some of the stats and figures, I think you guys
7:10
Speaker 2: will really understand why I want to talk about this
7:13
Speaker 2: because you often see these women who are passionate and
7:17
Speaker 2: driven and smart, and they get wrapped up in these
7:20
Speaker 2: businesses and they are putting so much time and energy
7:24
Speaker 2: and effort into, for example, selling skincare for somebody else's business.
7:29
Speaker 1: So while they are online busting their nuts essentially to
7:33
Speaker 1: actually get their business up and running, they are working
7:37
Speaker 1: away for somebody else. And with that same time, energy
7:40
Speaker 1: and effort that they are putting into somebody else's business,
7:44
Speaker 1: I genuinely believe that they could be building their own
7:47
Speaker 1: that would actually have a profit for them. So, whether
7:50
Speaker 1: that's skincare or essential oils or tableware or whatever it is,
7:55
Speaker 1: I just see so many people online selling these products
7:59
Speaker 1: and then not actually fully comprehending that it's not actually
8:03
Speaker 1: their business. And we saw this semi recently. A couple
8:07
Speaker 1: of years ago Avon left Australia and that actually left
8:10
Speaker 1: a lot of people high and dry who had been
8:13
Speaker 1: building there or what they presumed were their own business
8:16
Speaker 1: is for the last, you know, twenty something years to
8:19
Speaker 1: have it pulled out from underneath them. So I think
8:22
Speaker 1: that we need to have a really well rounded and
8:24
Speaker 1: proper discussion about this topic because I know that probably
8:28
Speaker 1: everybody in our Facebook group at some point has been
8:31
Speaker 1: messaged by someone who's like, oh, hey, I was just
8:34
Speaker 1: wondering how are you doing? Do you want me to
8:36
Speaker 1: talk to you about my new product? And I know
8:39
Speaker 1: that it's something that we actually really need to cover
8:41
Speaker 1: and really need to get across because I feel like
8:44
Speaker 1: there's so much delusion in that space where they sell
8:48
Speaker 1: you a dream, but the dream isn't actually.
8:50
Speaker 2: One hundred percent, and that's what we want to shed
8:52
Speaker 2: light on today.
8:52
Speaker 1: Yeah, so I'm glad I answered your question Georgia by
8:56
Speaker 1: absolutely not answering your questions. So let's jump straight in.
9:00
Speaker 1: MLM stands for multi level marketing, and you've probably heard
9:03
Speaker 1: a lot of other things that it's been called in
9:05
Speaker 1: the past, such as network marketing or referral marketing or
9:08
Speaker 1: direct selling or even pyramids scheme selling. But like most businesses,
9:14
Speaker 1: MLMs actually sell products and services. So if you do
9:18
Speaker 1: a really quick Google search for multi level marketing, you'll
9:21
Speaker 1: see so much criticism lobbed at MLMs, and I think that,
9:25
Speaker 1: whilst it's warranted, we really need to break this down.
9:28
Speaker 1: And this is because the business model is creepily similar
9:32
Speaker 1: to a Ponzi scheme or a pyramid scheme. So in
9:35
Speaker 1: classic pyramid schemes, you actually purchase into a company, paying
9:40
Speaker 1: a signup and or a monthly fee to be a
9:42
Speaker 1: part of that scheme, and to make your money back,
9:44
Speaker 1: you actually have to invite new investors or new partners
9:48
Speaker 1: into the company and so on and so forth. But
9:50
Speaker 1: as we've come to learn, this isn't actually sustainable because
9:53
Speaker 1: your success is actually built on the fact that you
9:56
Speaker 1: will sign more people up to this scheme. It's all
9:59
Speaker 1: about recruiting, exactly, And because there are finite amounts of
10:03
Speaker 1: people in the world, and not every single one of
10:05
Speaker 1: those people in the world wants to be a part
10:07
Speaker 1: of that scheme, you're going to soon run out of
10:09
Speaker 1: new recruits and you're not going to be able to
10:11
Speaker 1: make the lines. So in reality, only the top five
10:16
Speaker 1: percent of people in pyramid schemes actually end up making
10:19
Speaker 1: money and now we are talking about pyramid schemes right now,
10:22
Speaker 1: and I know a lot of people are going to
10:24
Speaker 1: want to be jumping down my throat being like that
10:25
Speaker 1: MLMs are pyramid schemes. You are correct. One of the differences,
10:29
Speaker 1: the defining difference of MLM that makes it not a
10:32
Speaker 1: pyramid scheme is that there is a tangible product associated
10:37
Speaker 1: with a MLM. So an MLM means that you actually
10:40
Speaker 1: sell a product in addition to doing all of the recruitment.
10:44
Speaker 1: But if you look into it properly, you will see
10:47
Speaker 1: that most of the revenue derived by a business that
10:50
Speaker 1: is of multi level marketing is not from the product
10:53
Speaker 1: they sell, but from the recruits that they drive. So
10:56
Speaker 1: I think it's really important to go, Okay, you're right,
10:58
Speaker 1: you are not wrong. Are not pyramid schemes, but they
11:02
Speaker 1: are creepily similar and they are not putting you in
11:05
Speaker 1: the best possible position long term. So how do you
11:08
Speaker 1: differentiate between an MLM and it's just a straight up
11:10
Speaker 1: pyramid scheme? One, pyramid schemes here in Australia are illegal,
11:14
Speaker 1: so I'm pretty sure.
11:15
Speaker 2: That they are. They're illegal in most places.
11:17
Speaker 1: I was going to say, I'm pretty sure that they
11:18
Speaker 1: are illegal internationally, but I don't want to be quoted
11:21
Speaker 1: on that, but I do know that they are completely
11:24
Speaker 1: illegal in Australia. But things to consider O, if you
11:27
Speaker 1: can make a decent amount of money through sales alone,
11:30
Speaker 1: it's a legitimate business. There are businesses out there that
11:33
Speaker 1: take people on to sell their products. It is not
11:35
Speaker 1: a new concept. If there are high end products that
11:39
Speaker 1: actually work, it's a legitimate business.
11:40
Speaker 2: All right, Victoria. So why would you say people are
11:43
Speaker 2: so drawn to MLMs then.
11:45
Speaker 1: Look, George, simply put, I think it's because they sound
11:47
Speaker 1: incredible and I've got friends who engage in them, so
11:51
Speaker 1: this is absolutely not an attack on them. And I
11:53
Speaker 1: think that, you know, I have a lot of really
11:55
Speaker 1: intelligent friends who are doing this, and I also know
11:58
Speaker 1: people who are doing it who are making money. So
12:00
Speaker 1: it's not something that we need to actually, you know,
12:03
Speaker 1: completely rip down. But what we need to be educated.
12:07
Speaker 1: They're really shiny, they look beautiful. How many jobs out
12:09
Speaker 1: there can promise you uncapped earning potential, Georgia king your
12:14
Speaker 1: own working hours, you get to work from home, the
12:16
Speaker 1: opportunity to be your own boss, etc. Etc. Without having
12:19
Speaker 1: to deal with a balance sheet or a profit and
12:20
Speaker 1: loss or worrying about employees. I think that it is
12:24
Speaker 1: selling a dream, and to be honest, it sounds great,
12:27
Speaker 1: so I can see why people want to be involved
12:29
Speaker 1: in them. But if you have the time and you
12:31
Speaker 1: have the energy and the effort to put into marketing
12:35
Speaker 1: somebody else's business, I think that you end up in
12:38
Speaker 1: a position where you might have been better off long
12:40
Speaker 1: term actually starting your own business. As scary as it
12:44
Speaker 1: can see, MLMs are also strongly targeted at women, and
12:48
Speaker 1: seventy five percent of distributors of MLMs here in Australia
12:52
Speaker 1: are actually female. Now, there are so many reasons for this,
12:56
Speaker 1: and the main one is that women are more likely
12:58
Speaker 1: to men to actually be home with the kids and
13:01
Speaker 1: be able to be targeted by these things. They're often
13:03
Speaker 1: looking to have a bit of a side hustle on
13:05
Speaker 1: the side, or contribute to the weekly income, and for
13:08
Speaker 1: many women, EMLM sound like a get rich quick scheme
13:11
Speaker 1: that they can actually do from the comfort of their
13:13
Speaker 1: home while still raising their kids and so on and
13:15
Speaker 1: so forth, and all sounds amazing. Honestly, it sounds like
13:19
Speaker 1: a dream. But we're going to break down exactly why
13:21
Speaker 1: it is not emilms also promise a certain level of
13:25
Speaker 1: support that is also not always delivered to these people,
13:29
Speaker 1: which can appeal to mums who I know personally through
13:33
Speaker 1: interacting with our community all to often feel really lonely
13:36
Speaker 1: when they're home with kids. Promises a community, It promises
13:39
Speaker 1: an online network of people who can support you in
13:41
Speaker 1: business partners And honestly, it sounds great and if this worked,
13:45
Speaker 1: I would be here going why doesn't everybody do this?
13:48
Speaker 1: But there is a very good reason why.
13:49
Speaker 3: I think.
13:50
Speaker 2: Another point to note is that there's also very strong
13:53
Speaker 2: ties to feminism LinkedIn with MLMs. They really capitalize the
13:57
Speaker 2: whole bus bed girl bust thing totally yeah. So they
14:01
Speaker 2: try to make I feel like they're empowering you and
14:03
Speaker 2: helping you in that space, when really they're.
14:05
Speaker 1: Just exploiting you, totally right. And it actually really upsets
14:08
Speaker 1: me because if you're empowering me, why are you making
14:11
Speaker 1: me buy the product before I can sell it. If
14:14
Speaker 1: it's such a good product that you're saying will literally
14:17
Speaker 1: sell itself, why do I have to purchase it first
14:19
Speaker 1: and keep my own inventory? So I feel like there
14:21
Speaker 1: are a number of questions that we need to be
14:23
Speaker 1: asking of these companies as to whether they have our
14:26
Speaker 1: best interests at heart or not. As you said, like
14:29
Speaker 1: they're strongly tied to feminism, they're also so female orientated.
14:33
Speaker 1: Like think about the types of products that are in
14:36
Speaker 1: the lamps. We're talking about kitchen tubleware, we're talking about
14:39
Speaker 1: weight loss shakes, leggings, essential oils, cosmetics, which obviously appeal
14:45
Speaker 1: to women more than that does men. And potential people
14:49
Speaker 1: who are recruited into this, or we could call it
14:51
Speaker 1: lud into this, they can imagine themselves using this product
14:54
Speaker 1: and they are often conned into purchasing the product for themselves.
14:58
Speaker 1: So the company is not just making sales from the
15:01
Speaker 1: people that they recruit or the people that you sell to.
15:05
Speaker 1: They're also making sales for you because obviously you have
15:08
Speaker 1: to purchase that product to try out, yeah, before you
15:10
Speaker 1: sell it to somebody else, because otherwise you look like
15:12
Speaker 1: a complete fraud, Like why would you be selling a
15:14
Speaker 1: product you've not even tried yourself. So they end up
15:17
Speaker 1: in a position where they're making multiple sources of revenue
15:20
Speaker 1: from a place that it probably shouldn't be coming because
15:24
Speaker 1: at the end of the day, Georgie, if I hired
15:26
Speaker 1: you to sell my product. I would want you to
15:28
Speaker 1: be an advocate of my product, so why wouldn't I
15:30
Speaker 1: just give it to you.
15:31
Speaker 2: Also, MLMs often target people from lower socioeconomic backgrounds and
15:35
Speaker 2: low income earners, people who don't have formal education backgrounds,
15:39
Speaker 2: a degree of certificate. You don't need those to get
15:41
Speaker 2: involved with an MLM. You can just sign up, pay
15:43
Speaker 2: your entry fee, and off you go. So they are
15:46
Speaker 2: praying on people who are more vulnerable, maybe don't have
15:49
Speaker 2: as many other options, and sadly the're the ones that
15:52
Speaker 2: are going to be emotionally and financially joined in the end. Right.
15:54
Speaker 1: Yeah, And I think it's really depressing as well because
15:56
Speaker 1: you're sold a dream and there's a lot of stats
15:59
Speaker 1: that surround this. Let's start having a chat about those,
16:02
Speaker 1: because I think that they are the thing that's going
16:03
Speaker 1: to really drive home now, guys. Because MLMs are usually
16:08
Speaker 1: based out of America and then come to Australia, a
16:11
Speaker 1: lot of these statistics aren't Australian, but they absolutely apply
16:15
Speaker 1: to all of the people engaging in MLM companies here
16:18
Speaker 1: in Australia because they're a part of that. So we
16:21
Speaker 1: tried to get really Australian statistics, but they weren't relevant
16:25
Speaker 1: and it really didn't feel like they had the impact
16:27
Speaker 1: that these do. So if you're even considering getting involved
16:30
Speaker 1: in AMLM, I think one of the first things that
16:33
Speaker 1: you should be doing is going and looking at the
16:35
Speaker 1: income disclosure statement. So this statement is going to be
16:39
Speaker 1: breaking down the rank of each person within that business,
16:43
Speaker 1: the percentage of the person at that level in the business,
16:47
Speaker 1: and then their average annual income. And I think that
16:50
Speaker 1: that's really important to understand because you'll see where most
16:54
Speaker 1: of the people are sitting. Okay. So something that has
16:58
Speaker 1: recently come to Australia is Monete and this is a
17:01
Speaker 1: skincare company that is an MLM business, very similar to
17:05
Speaker 1: Rodent Fields or are Born. They've come to Australia recently
17:09
Speaker 1: and I've had a look at their income disclosure statement
17:12
Speaker 1: and I think that it is really telling. So the
17:15
Speaker 1: most popular level in their business is called a market partner,
17:19
Speaker 1: and that is what ninety four percent or ninety four
17:23
Speaker 1: point zero three percent of the people in their business
17:26
Speaker 1: are ranked at, and per ANNAM, the average annual income
17:31
Speaker 1: of one of their market partners is one hundred and
17:34
Speaker 1: eighty three dollars US and so annual annual income of
17:39
Speaker 1: ninety four percent of their company is one hundred and
17:42
Speaker 1: eighty three dollars Georgia. And so if that's not shocking enough,
17:46
Speaker 1: if you would like to sign up to Monet to
17:48
Speaker 1: become one of their skincare partners, you have to buy
17:51
Speaker 1: their trial pack and you have to buy their startup
17:53
Speaker 1: kit Georgia. That's one hundred and ninety nine dollars. So
17:56
Speaker 1: that is actually more than what you made in the year.
17:59
Speaker 1: So you were actually paying them to be a part
18:01
Speaker 1: of the business and you are not making anything, and
18:04
Speaker 1: so you're like, okay, well that's ninety four percent of
18:05
Speaker 1: the company. Then the next level up is a managing
18:09
Speaker 1: market partner and that makes up two point seventy four
18:12
Speaker 1: percent of that business, and their average annual income is
18:16
Speaker 1: two thousand, three hundred dollars for the entire year of
18:20
Speaker 1: work that they have done to recruit other people and
18:23
Speaker 1: grow their businesses, which is quite dramatic. But that then
18:28
Speaker 1: doesn't take into consideration the fact that these managing market
18:31
Speaker 1: partners would have had to purchase one their own product,
18:34
Speaker 1: their own startup kits. All of the things included in
18:37
Speaker 1: that which I looked into, and that averages at about
18:41
Speaker 1: eight hundred dollars in product purchased by a managing market partner.
18:45
Speaker 1: So take that back to about fifteen hundred dollars worth
18:48
Speaker 1: of profit. Let's call it that. That is not okay
18:51
Speaker 1: for an entire year's worth of work. Imagine starting an
18:55
Speaker 1: online business, and that is what you generated in the
18:58
Speaker 1: first year of being on so media, of being in
19:01
Speaker 1: a position where you're selling someone else's product. I would
19:04
Speaker 1: have expected it to be far more and it actually
19:07
Speaker 1: does it increase in a better way at all, because
19:10
Speaker 1: the further you look into it, the lower the percentages.
19:14
Speaker 1: And the highest paid person in the business there's like
19:17
Speaker 1: three of them and they get paid more than one
19:20
Speaker 1: hundred thousand dollars. But of all of those people, they're
19:23
Speaker 1: the ones that are you know, they're the shiny ones
19:26
Speaker 1: that everyone refers to it say, oh my gosh, you're
19:28
Speaker 1: my first year I did this, and I think that
19:30
Speaker 1: it's really important toutically you go, okay, no problems. But
19:33
Speaker 1: ninety four percent of the business make one hundred and
19:37
Speaker 1: eighty three dollars but had to spend one hundred and
19:39
Speaker 1: ninety ninety even get.
19:40
Speaker 2: Involved in the business. And that's why it's closely linked
19:44
Speaker 2: to pyramid schemes, right, like the richie riches are up
19:47
Speaker 2: the top making all of the coin, and then everyone
19:49
Speaker 2: else below ninety four percent.
19:51
Speaker 1: Like nothing exactly, And the only difference between a pyramid
19:55
Speaker 1: scheme and an MLM is the fact that an MLM
19:58
Speaker 1: has a product associated with it in addition to having
20:02
Speaker 1: that pyramid structure.
20:04
Speaker 2: So it sounds like the main danger here is that
20:06
Speaker 2: MLMs are just not a sustainable way of making money.
20:09
Speaker 2: Are there any other reasons we shouldn't be getting into it?
20:11
Speaker 2: I mean, that's pretty good one.
20:12
Speaker 1: I mean that's pretty good, But no, there's no guaranteed
20:16
Speaker 1: incoming to People often find themselves buying the product just
20:19
Speaker 1: to make their bonuses and stuff like that. So, like,
20:21
Speaker 1: if you look further into the business structure, you'll find
20:24
Speaker 1: that each and every single month, they need to make
20:26
Speaker 1: a certain amount of sales per month to make a bonus.
20:30
Speaker 1: And people don't want to lose their bonus because often
20:33
Speaker 1: their bonus is retained from previous months. So you're forced
20:36
Speaker 1: into purchasing your own product. And if you were doing
20:39
Speaker 1: this in your own business, it wouldn't be sustainable, it
20:41
Speaker 1: wouldn't make sense. It really seems like you own your
20:44
Speaker 1: own business, but in reality, you're just a very small
20:47
Speaker 1: part of a very large company that are using you
20:51
Speaker 1: to get their product into the market. And at the
20:54
Speaker 1: end of the day, I've said this before and this
20:56
Speaker 1: is very opinionated of me, but if that product was
20:59
Speaker 1: a very very good product, why isn't it on the
21:02
Speaker 1: shelves in every good skincare company, Like if it is
21:05
Speaker 1: the best cleanser in the world, why has Mecca not
21:08
Speaker 1: been able to pick it up. I also think it's
21:10
Speaker 1: really important to touch on the fact that as much
21:12
Speaker 1: as you are a small part of a big company
21:15
Speaker 1: and they're empowering you to be a small business owner
21:18
Speaker 1: and you know, do your own thing, there is no
21:21
Speaker 1: actual benefit to this because you don't get sick days,
21:24
Speaker 1: you don't get days off, you don't get annual leave,
21:26
Speaker 1: and a lot of people have to work weekends and
21:28
Speaker 1: nights just to try and make ends meet with these
21:31
Speaker 1: products that don't pay you a wager, a salary, or
21:33
Speaker 1: a base income or a retainer to make sure that
21:36
Speaker 1: you do this. You only ever make money on the
21:39
Speaker 1: commission or from the people that you've recruited, which means
21:43
Speaker 1: that everybody's clipping the ticket along the way. So, Georgia,
21:45
Speaker 1: if I recruited you, i'd clip the ticket on all
21:48
Speaker 1: of the sales that you make. But the person who
21:50
Speaker 1: recruited me is clipping the ticket on both of us. Yeah,
21:52
Speaker 1: and it kind of goes like that in a chain,
21:55
Speaker 1: which is why the pyramid scheme makes a lot of sense. Georgia.
21:58
Speaker 1: I also think, and I'm so anti on this episode,
22:01
Speaker 1: so I do apologize, but lots of MLMs also encourage
22:04
Speaker 1: you to capitalize on devastating moments, and I know that
22:07
Speaker 1: that's probably not the first thing that you guys were
22:09
Speaker 1: thinking of. So I was actually reading an article the
22:12
Speaker 1: other day that was written by a lady whose mother
22:14
Speaker 1: had just passed away and someone from high school had
22:17
Speaker 1: reached out to her sending love, which was so nice.
22:20
Speaker 1: But then she replied saying thanks and then tried to
22:22
Speaker 1: sell her essential oils to help her achieve cotness, so gross,
22:26
Speaker 1: and then also tried to get her in her team
22:29
Speaker 1: because she was killing it, etc. Hate girl, It'll take
22:32
Speaker 1: your mind off, you know, the trauma that you're going through,
22:35
Speaker 1: which is so unetheical, that unethical, and so gross. There
22:39
Speaker 1: is so much pressure, which means people don't actually act
22:42
Speaker 1: ethically or put you in a situation where they are
22:45
Speaker 1: thinking of you well. And I just feel like that
22:48
Speaker 1: is not okay, and it is not it's not right,
22:51
Speaker 1: like so many times I've been messaged and I'm probably
22:54
Speaker 1: putting myself in this position just because I've got the
22:57
Speaker 1: Facebook group and I'm the admin of it. But I
22:59
Speaker 1: get literally messages every single day. So Georgia, when we said, like,
23:03
Speaker 1: should we do an episode on MLMs, I was like, yes,
23:05
Speaker 1: let's talk about it. I get messages every single day
23:09
Speaker 1: from people saying, oh, hey, Victoria, I run this company.
23:12
Speaker 1: It's a really good skincare company. I'd love to tell
23:15
Speaker 1: you more about it. Let me know if you're interested,
23:17
Speaker 1: And it just makes no sense. And then they want
23:19
Speaker 1: to post on the Facebook group because they want more recruits,
23:22
Speaker 1: and I have to say, look, I'm really sorry, like
23:24
Speaker 1: we don't support MLMs, and they'll say, oh, Victoria, it's
23:27
Speaker 1: not an MLM, it's a network marketing business. Like okay,
23:31
Speaker 1: like same thing, and they just seem to be so
23:34
Speaker 1: brought into the fact that no, it's my business. I
23:38
Speaker 1: run it. I just buy the product from here, and
23:40
Speaker 1: it just makes no sense. And I just feel like
23:42
Speaker 1: these girls are hustling their butts off. Let's be honest, George,
23:45
Speaker 1: like they are working really hard, but direct your time,
23:49
Speaker 1: energy and effort into something that is actually yours and
23:52
Speaker 1: I'm sure you would be wildly successful as well. This
23:55
Speaker 1: structure is just not sustainable for the long term.
23:58
Speaker 2: I think the last point to note there is well,
24:00
Speaker 2: Victoria is that and you kind of alluded to it before.
24:02
Speaker 2: But relationships can be ruined through this kind of marketing.
24:05
Speaker 2: Like you're reaching out to Carol from high school saying,
24:09
Speaker 2: do you want to be a part of my team?
24:10
Speaker 1: Carol's not Oh hey, girl, I just thought you had
24:12
Speaker 1: a baby. Yeah, oh thanks, Yeah. Can I come my
24:15
Speaker 1: own and show you my essential oil kid?
24:17
Speaker 3: Yeah?
24:18
Speaker 1: No, no girl.
24:19
Speaker 2: So that relationship with Carol is ruined. But then also
24:21
Speaker 2: you get desperate and you go to your friends, you
24:23
Speaker 2: go to your parents, you go to your chip, and
24:24
Speaker 2: you don't go to your children. Maybe some people do,
24:26
Speaker 2: but it can be really damaging in that sense. And
24:29
Speaker 2: then also because people are they're not doing this in
24:31
Speaker 2: the nine to five hours, they're gonna have to work
24:33
Speaker 2: at nighttime, in the day, on weekends at every moment,
24:36
Speaker 2: so they're going to be neglecting their family. It's not
24:38
Speaker 2: in every situation, but I think that that's a really
24:41
Speaker 2: big risk as well.
24:41
Speaker 1: There I totally agree, and it makes me feel sort
24:45
Speaker 1: of strange because it's always people that I'm not that
24:48
Speaker 1: close with that approach me and I go, oh, how
24:51
Speaker 1: nice is that I'm hearing from x y zed And
24:53
Speaker 1: they're like, oh, hey, Victoria, I've been working as a
24:55
Speaker 1: personal trainer. I'm like, oh, girl, that's amazing, congrats. And
24:58
Speaker 1: then they're like, oh, and recently I've had heaps of
25:01
Speaker 1: success with this diet shake, Like would you get trying it?
25:04
Speaker 1: And you're like no, I'm okay.
25:08
Speaker 2: And Facebook makes it a lot easier than back in
25:10
Speaker 2: the old days as well, Like it's prolific absolutely. But
25:13
Speaker 2: I think if we're going to talk about Facebook and
25:15
Speaker 2: social media, did you know that if you are part
25:17
Speaker 2: of an MLM, you cannot pay for any advertising.
25:20
Speaker 1: On your product.
25:21
Speaker 2: I did not know this. Why is that?
25:22
Speaker 1: Because they don't want you advertising it. It's all network
25:25
Speaker 1: You have to go to people, so you're forced down
25:28
Speaker 1: the route of directly contacting people instead of you know,
25:31
Speaker 1: maybe starting a social media account and growing the business
25:35
Speaker 1: that way and putting some you know, some money behind
25:37
Speaker 1: an advertisement so that you can actually get your name
25:40
Speaker 1: out there. Yeah, that's not allowed. You can't actually pay
25:42
Speaker 1: for advertising. And if you're going to start a business online,
25:46
Speaker 1: you're not actually allowed to talk about the price of
25:48
Speaker 1: the products online. And there's just so many catches that
25:51
Speaker 1: make it seem so non transparent and just not genuine
25:56
Speaker 1: that make me feel really uncomfortable. And the annoying thing
26:00
Speaker 1: here is like some of these businesses actually have products
26:02
Speaker 1: that I like, Like, don't get me wrong, Like I
26:05
Speaker 1: have purchased dough Terra and I loved dough Terra, and
26:08
Speaker 1: I have a really great friend who actually sells it,
26:11
Speaker 1: and you know what, she's beautiful. She does the right thing,
26:14
Speaker 1: you know what, she has this beautiful lifestyle, and Essential
26:17
Speaker 1: Oils really aligned to what she's doing. She is at
26:19
Speaker 1: no point pretending that this product is actually going to
26:22
Speaker 1: solve world hunger or anything like that. She's just like, yep,
26:25
Speaker 1: I think people lack them, and this is you know
26:27
Speaker 1: what it is. I also love essential oils, like I
26:30
Speaker 1: love my diffuser Georgia would know that there's a couple
26:32
Speaker 1: in our offices, and I just feel like it is
26:35
Speaker 1: a really nice product. But I don't believe that that
26:39
Speaker 1: structure needs to exist to sell a beautiful product. Like
26:42
Speaker 1: I am attracted to that as a product, But will
26:45
Speaker 1: I purchase from it moving forward because it's an MLM
26:48
Speaker 1: now that I'm educated about what it actually is, No,
26:51
Speaker 1: I won't. I'll go and find a different source. So
26:53
Speaker 1: I think it's really important to just be educated about things.
26:56
Speaker 1: But yeah, it's it's really really interesting how it actually
27:00
Speaker 1: works and what it actually means. And sometimes you can
27:02
Speaker 1: just get so wrapped up in it without even realizing
27:04
Speaker 1: that you're being sold to. Because as we're talking before Georgia,
27:08
Speaker 1: there are so many transparent ways that you see people
27:11
Speaker 1: recruiting you, like hey, MPT, would you like to try
27:13
Speaker 1: these diet shakes? But then you also see you know,
27:16
Speaker 1: influences online using this product. Yeah, and then you go, oh,
27:19
Speaker 1: I'd really like that product, and they're like, oh, you
27:20
Speaker 1: have to message this person to get access to it,
27:22
Speaker 1: and you're like, okay. The problems like and you want
27:24
Speaker 1: to do it because you want to try this product
27:26
Speaker 1: because you've just got this idea, but that's all part
27:29
Speaker 1: of the trap, right.
27:30
Speaker 2: So from the sounds of things, Victoria, it sounds like
27:32
Speaker 2: you are significantly more likely to lose money than make
27:34
Speaker 2: money despite all the promises of these companies.
27:36
Speaker 1: Right absolutely, And I've done some research because we always
27:39
Speaker 1: do research because starts gal but the loss rate for
27:44
Speaker 1: MLMs here in Australia is ninety nine percent. Do you
27:47
Speaker 1: know what that means? That means that less than one
27:50
Speaker 1: in one hundred MLM participants make a clear profit and
27:53
Speaker 1: at least ninety nine out of every one hundred people
27:56
Speaker 1: engaging in these actually lose money, which is insane, iculous.
28:00
Speaker 1: And do you know why that's insane because if you
28:03
Speaker 1: compare that to research by the Small Business Association, you
28:08
Speaker 1: found that forty four percent of small businesses survive for
28:11
Speaker 1: at least four years. So if you're going to put
28:13
Speaker 1: this time, energy and effort into something, you are actually
28:16
Speaker 1: better off putting it into a small business that you
28:19
Speaker 1: own and run yourself, because just looking at the statistics,
28:22
Speaker 1: you are more likely to be profitable and successful by
28:26
Speaker 1: running your own thing than you are from actually engaging
28:29
Speaker 1: in an MLM. Because to actually progress in an MLM,
28:33
Speaker 1: you need to recruit people underneath you to sell product
28:36
Speaker 1: as well, and that's just not feasible for most people.
28:39
Speaker 1: Whereas in small business, you can run your own show,
28:42
Speaker 1: and you can be in a situation where you actually
28:44
Speaker 1: have control. I actually think it's a bit crazy how
28:48
Speaker 1: promoted these are. Yet the stats are so wild and
28:52
Speaker 1: bad for us, but no one ever really talks about
28:54
Speaker 1: that exactly.
28:56
Speaker 2: Here's another stut for you if you're interested, Victoria, Yes,
28:58
Speaker 2: stats now come at So. A study out of America
29:01
Speaker 2: again found that ninety five percent of people within MLM
29:05
Speaker 2: companies dropped out within ten years because it is just
29:08
Speaker 2: so unsustainable. Ninety nine percent of them aren't making any money,
29:11
Speaker 2: they're losing money exactly. So I think we really need
29:14
Speaker 2: to be talking about this. People just don't know.
29:16
Speaker 1: People don't know, and they don't know what's good for
29:18
Speaker 1: them either. And I think that an MLM makes you
29:21
Speaker 1: feel incredibly supported and incredibly comfortable. So if you've ever
29:25
Speaker 1: been in a situation where you've said, I wish I
29:27
Speaker 1: could just do my own thing, but I'm not confident
29:29
Speaker 1: enough to do it, MLMs will peek you up and say, oh,
29:32
Speaker 1: we'll give you the team, support, we'll give you the product,
29:34
Speaker 1: we'll give you everything. You can be a girl lost
29:36
Speaker 1: and run your own show. And I just feel like
29:39
Speaker 1: that is preying on people who are vulnerable and just
29:42
Speaker 1: need to be built up so that they can run
29:44
Speaker 1: their own thing, because you can do it and you
29:47
Speaker 1: are completely smart enough and you are successful. Dumber people
29:50
Speaker 1: have done better things Georgia than a lot of us,
29:53
Speaker 1: and I just feel like we need to have some
29:55
Speaker 1: conviction in ourselves instead of relying on someone else that
29:58
Speaker 1: sells us a dream, that puts us in a position
30:01
Speaker 1: where we are not financially better off. So I feel
30:04
Speaker 1: like the message of this podcast has been pretty clear.
30:07
Speaker 1: We should be we should be staying away from MLMs
30:10
Speaker 1: where we can. But are there any words of wisdom
30:12
Speaker 1: you'd like to leave us on the trail? Yeah, as
30:14
Speaker 1: you said, I think avoiding it where we can. If
30:17
Speaker 1: you're already involved with one link. Please don't get me wrong.
30:19
Speaker 1: I'm not trying to throw everybody under a bus here,
30:22
Speaker 1: but I really want you to be educated on something
30:25
Speaker 1: like this. I want you to know that you are
30:27
Speaker 1: completely capable and you have the ability to build a
30:30
Speaker 1: business and generate your own revenue, especially if you're putting
30:33
Speaker 1: all of that time and energy and effort into somebody
30:36
Speaker 1: else's I think we also need to really remember that
30:39
Speaker 1: people working with MLMs, as distributors are often told to
30:43
Speaker 1: fake it till they make it to entice other people
30:45
Speaker 1: to join their quote tribe or whatever it is. And
30:48
Speaker 1: I think that we just need to be really wary
30:49
Speaker 1: of this and stay vigilant, like sometimes if it is
30:52
Speaker 1: too good to be true, it often is. And I
30:55
Speaker 1: think that as much as your friend is trying to
30:57
Speaker 1: recruit you, or you know, the girl you went to
30:59
Speaker 1: high school with that you haven't spoken to in twelve
31:01
Speaker 1: years is trying to recruit you into a business, like,
31:04
Speaker 1: have a little bit of a think about why that
31:06
Speaker 1: might be the case, Like why is she so desperate
31:08
Speaker 1: to give you this opportunity after having not spoken to
31:11
Speaker 1: you for the last twelve years. And something else that's
31:14
Speaker 1: really important to me is that if financial freedom is
31:17
Speaker 1: your end goal, and to Georgia King, if anyone is
31:19
Speaker 1: listening to this podcast, I really hope it is your
31:23
Speaker 1: end goal, a better decision would potentially be to invest
31:27
Speaker 1: in your education or resources you need to pursue a
31:30
Speaker 1: more reliable and stable career instead of spending money on
31:33
Speaker 1: an MLM to get started with a starter kit and
31:36
Speaker 1: then having to buy their product to sell their product
31:38
Speaker 1: to stock it so that you can get it out
31:40
Speaker 1: to your quote clients, and I think that you know. Finally,
31:43
Speaker 1: I just really want to round this conversation out here
31:46
Speaker 1: by adding that there is absolutely no judgment here if
31:49
Speaker 1: you are a part of a business that works to
31:51
Speaker 1: an MLM model, and if you can make it work
31:54
Speaker 1: like incredible, amazing, like I'm so here for you as
31:56
Speaker 1: a business person. I just feel like there are so
31:59
Speaker 1: many negative things associated with the MLAMS that we need
32:03
Speaker 1: to talk about this, and we need people to be
32:05
Speaker 1: wary because recruiting people can often be really unethical. We
32:09
Speaker 1: just really want to shed light on this topic today,
32:12
Speaker 1: as we thought our community really good benefit from understanding
32:15
Speaker 1: MLMs a little bit more, just so they can be
32:18
Speaker 1: informed if they're ever approach to join our MLM, which
32:21
Speaker 1: I know, especially at the moment, is happening more and more.
32:24
Speaker 1: And I know this because I am paying approach to myself.
32:28
Speaker 2: Yeah, Hi, there, you've preached that she is on the
32:35
Speaker 2: money mailbox. Do you have the money problem you want
32:37
Speaker 2: to help solve me? Do you have the money to
32:38
Speaker 2: Lemma you just want to chat about? Victoria is here
32:41
Speaker 2: to help. Every week we'll be playing your questions to
32:43
Speaker 2: help make sense of a money master man I found
32:45
Speaker 2: yourself in. Make a quick recording on your phone and
32:47
Speaker 2: send it through to podcasts at shoesodthmoney dot com dot
32:50
Speaker 2: you and you might even find yourself on the show.
32:52
Speaker 2: But for now here, Today's listener question.
32:55
Speaker 3: Hey, Victoria and Georgia. Like a lot of people, I
32:58
Speaker 3: have lost my job this year because of COVID. I'm
33:01
Speaker 3: a unique student studying nursing and I'm living at home
33:04
Speaker 3: and i was working part time in hospitality, but I'm
33:08
Speaker 3: now just getting payments from the government and I'm feeling
33:10
Speaker 3: a little bit helpless. My friends work with do Terra
33:14
Speaker 3: and says it's really good and easy way to make
33:16
Speaker 3: a bit of money. But I know MLMs have a
33:19
Speaker 3: bit of a bad reputation financially. Do you think this
33:23
Speaker 3: is a good decision to start an MLM side hustle
33:27
Speaker 3: or am I better off doing my own thing? Can't
33:30
Speaker 3: wait to hear.
33:30
Speaker 2: Back based on today's conversation, Victoria, I think I know
33:34
Speaker 2: what your answer is going to be for this one,
33:36
Speaker 2: but go ahead, what do you think?
33:38
Speaker 1: I think this is a really interesting one. Disclaimer this though,
33:42
Speaker 1: sometimes there are some MLMs that work really well and
33:45
Speaker 1: they might fit really well into your lifestyle. For example,
33:48
Speaker 1: I know Tubbleware is an MLM company, but I also
33:51
Speaker 1: know there are some people who settle that who really
33:54
Speaker 1: like the lifestyle it affords them. They're not looking to,
33:57
Speaker 1: you know, make a million dollars a year. That's interested
33:59
Speaker 1: in having a couple of tupperware parties with their friends,
34:02
Speaker 1: and they just want to be in a position where
34:03
Speaker 1: they have a little bit of extra income, but they're
34:05
Speaker 1: not completely reliant on it. If you're in a situation
34:08
Speaker 1: where you have lost your job, I'm not sure if
34:11
Speaker 1: an MLM is the right way to go about it,
34:13
Speaker 1: because it's going to take you some significant time to
34:16
Speaker 1: build up enough of a base to actually have an
34:19
Speaker 1: income that could supplement the lifestyle and the income that
34:22
Speaker 1: you have lost. If it's a side hustle, then absolutely sure,
34:25
Speaker 1: like work it out yourself if you're comfortable with it
34:28
Speaker 1: after reading through their income disclosure statements and the rules
34:31
Speaker 1: and regulations associated with becoming a representative for them. Like
34:35
Speaker 1: as I said, I'm not completely against it. I just
34:37
Speaker 1: want us to be making educated decisions. But I do
34:40
Speaker 1: think that if you have a skill or inability and
34:43
Speaker 1: you want to start a side hustle, you're potentially better
34:46
Speaker 1: off doing your own thing. Like side hustles are great.
34:49
Speaker 1: There are so many different things you could do. You
34:51
Speaker 1: could be jumping on air tasker and doing little admin jobs,
34:55
Speaker 1: or copyrighting jobs for people, or pulling together something or
34:58
Speaker 1: running errands or there are so many things that people do,
35:01
Speaker 1: including online surveys and stuff like that, that you can
35:04
Speaker 1: do online to actually generate some income, which would arguably
35:07
Speaker 1: be a more solid income that doesn't require you to
35:11
Speaker 1: make an investment in someone else's product.
35:13
Speaker 2: Or for your stuff. A much less risky choice.
35:16
Speaker 1: Yeah, a much less risky choice. We're not in a
35:18
Speaker 1: position where we need to take massive risks to be
35:20
Speaker 1: able to retain the lifestyle we want, and we can
35:22
Speaker 1: actually do that in a more sustainable way. And I
35:25
Speaker 1: just feel like maybe an EMLEM is a little bit
35:28
Speaker 1: risky in comparison to what you're trying to replace, especially
35:32
Speaker 1: if you were a unique student studying nursing, Like you're
35:35
Speaker 1: obviously not silly, like go and do something that could
35:38
Speaker 1: help people. Go and do something that you know works
35:41
Speaker 1: for you online.
35:42
Speaker 2: And I mean, jobs are very hard to come by
35:44
Speaker 2: at the moment, obviously, but she is living at home.
35:46
Speaker 2: She's still getting those payments from the government at the moment,
35:49
Speaker 2: so she shouldn't be too stressed out. Like you might
35:51
Speaker 2: not have that income that you're used to, but maybe
35:53
Speaker 2: just chill out a little bit, don't get yourself into
35:57
Speaker 2: a super stressful state. And I wouldn't have thought an
36:01
Speaker 2: MLM is a good idea, that's my opinion.
36:03
Speaker 1: Yeah, and I don't disagree with it, but I'm all
36:05
Speaker 1: for people having freedom of choice and everybody making their
36:08
Speaker 1: own decisions. But Georgia, we're in a position where we
36:11
Speaker 1: just want you to make the most educated decision for you.
36:14
Speaker 1: And if you look at it and you go to Victoria,
36:16
Speaker 1: I really want to do this, go for it. I'm
36:18
Speaker 1: here for it, like I want you to be happy,
36:20
Speaker 1: and I want you to be in a position where
36:23
Speaker 1: you are actually being impactful. But we know that ninety
36:27
Speaker 1: nine zero point seven percent of people will lose money
36:30
Speaker 1: in network marketing schemes. So for every thousand people who
36:34
Speaker 1: join in MLM, only three earn more money than they
36:37
Speaker 1: actually spend.
36:38
Speaker 2: Yeah, so keep that one in mind. We hope that
36:40
Speaker 2: gives you some clarity.
36:45
Speaker 4: Hi, I'm twenty seven years old, I'm a recovery after
36:48
Speaker 4: pay addict, and this is my money diary.
36:50
Speaker 2: Now for the fun stuff. What good would a money
36:52
Speaker 2: podcast be without the purby bits. It's time for money diaries.
36:55
Speaker 2: We started off by asking her about her attitude to money.
36:58
Speaker 4: I guess money als was important to me to you know,
37:02
Speaker 4: like make sure I was living without living paycheck to
37:06
Speaker 4: paycheck essentially. But I had a really bad spending habit,
37:09
Speaker 4: and I just you know, the money would hit my
37:11
Speaker 4: account and I'd be like, well, let's go out for
37:13
Speaker 4: drinks or let's go out for dinners, just frivolously spending
37:17
Speaker 4: my money. But now I suppose because I've had a
37:20
Speaker 4: little bit more direction from listening to the podcast and
37:23
Speaker 4: reading books like The Barefoot Investor, I have a better
37:26
Speaker 4: understanding of the value of money and the importance of
37:30
Speaker 4: creating wealth so that you don't have to struggle later
37:32
Speaker 4: on in life. So now I'd say I put quite
37:35
Speaker 4: a lot of value on money, essentially that I'm more
37:38
Speaker 4: aware of it, and I don't like to needlessly spend
37:42
Speaker 4: money just because I have to.
37:44
Speaker 2: Let's get into the juicy stuff. How much does she
37:46
Speaker 2: earn and how much you're sitting in her bank account
37:48
Speaker 2: right now?
37:49
Speaker 4: I'm a registered nurse. Last pay year, I earned about
37:53
Speaker 4: sixty nine thousand dollars and in my bank accounts, I've
37:56
Speaker 4: got about eight and a half thousand saved.
38:00
Speaker 2: What exactly happens to that money after it's deposited into
38:02
Speaker 2: her account?
38:03
Speaker 4: Yeah, so I get paid roughly, again, depending on if
38:07
Speaker 4: I've worked weekends or nights, et cetera, about two thousand
38:11
Speaker 4: and fortnight. So I have one thousand dollars that goes
38:15
Speaker 4: automatically into savings and then I deposit about eight hundred
38:22
Speaker 4: and forty one dollars into my bills account and the
38:25
Speaker 4: rest goes just into like my everyday spending account for
38:29
Speaker 4: groceries and bits and pieces.
38:31
Speaker 2: Alrighty, then, so how does she feel about investing? Does
38:34
Speaker 2: she invest?
38:35
Speaker 4: And if so, how I've done a lot of research
38:37
Speaker 4: on investing. Well, when I say a lot, like not
38:40
Speaker 4: that much like reading books or anything like that. But
38:43
Speaker 4: I've invested about one thousand dollars in a business using
38:48
Speaker 4: the Comsex app, and I also use raise.
38:51
Speaker 2: What about debts like credit cards or personal loans?
38:54
Speaker 4: When I started listening to the podcast in December slash January,
38:59
Speaker 4: I felt I was drowning in debt like I had
39:01
Speaker 4: nine and a half thousand dollars on a credit card.
39:03
Speaker 4: I had an after pay addiction that was incredible. I
39:07
Speaker 4: was just using it for literally everything, Christmas presents, birthday presence.
39:11
Speaker 4: I also have my hex debt, and I had a
39:14
Speaker 4: car loan. But since then, I've paid off and closed
39:18
Speaker 4: my after pay account. I've paid off my car loan,
39:21
Speaker 4: and now I only have four thousand dollars owing on
39:23
Speaker 4: a credit card and fourteen thousand dollars in hextet.
39:27
Speaker 2: Does she have any good money habits that she's especially
39:29
Speaker 2: proud of.
39:30
Speaker 4: I'd say my best money habit is I don't make
39:33
Speaker 4: a purchase on clothing very quickly, Like if I see
39:36
Speaker 4: something in the shops, I definitely never buy it at
39:40
Speaker 4: that stage if I really really need it, like I'll
39:42
Speaker 4: go back a week later. I've got that like mulling
39:45
Speaker 4: over process time and also just setting up the direct
39:50
Speaker 4: debits into my savings account, because once the money's gone
39:53
Speaker 4: into that account, I absolutely do not touch it.
39:55
Speaker 2: And what about her worst money habit.
39:58
Speaker 4: Previously, my worst money habits we absolutely using after pay
40:01
Speaker 4: for anything. I'd have money in my bank account and
40:04
Speaker 4: I'd just be like, well, after pay it, and then
40:07
Speaker 4: you know, you just end up with like ten twenty
40:09
Speaker 4: after pays going at once, and the balance like each
40:12
Speaker 4: fortnite is like hundreds and hundreds of dollars. I was
40:15
Speaker 4: living with a housemate who's a nurse as well, and
40:17
Speaker 4: we both started the same year, so we were getting
40:19
Speaker 4: paid the same amount, and she in December was like, whoa,
40:23
Speaker 4: I've saved ten thousand dollars this year, and I was like,
40:25
Speaker 4: what the hell? How have you managed to save ten
40:28
Speaker 4: thousand dollars? Like, I literally have got no money in
40:31
Speaker 4: my bank account to show for this. So I just
40:33
Speaker 4: used all the tips and tricks that Victoria always says.
40:36
Speaker 4: So I did a consolidation of all my debts, so
40:39
Speaker 4: it's just now on one credit card at zero percent
40:42
Speaker 4: interest for like thirty six months, so it's not like
40:44
Speaker 4: I'm getting stung with the interest on the repayments.
40:47
Speaker 2: So what's today's money diarist actually saving for? What's her
40:51
Speaker 2: big money goal?
40:52
Speaker 4: So I'm saving for a house at the moment. That's
40:54
Speaker 4: my current big money goal. Like I have got the
40:58
Speaker 4: money in my savings account to pay off the rest
41:00
Speaker 4: of my credit card at the moment, but I don't
41:01
Speaker 4: really feel the need to because I've got the zero
41:04
Speaker 4: percent interest, so I'm just like slowly chipping away at
41:07
Speaker 4: that one and putting most of my money into my
41:09
Speaker 4: savings because I know by the time that i'd be
41:12
Speaker 4: ready with a deposit, that card will have been well
41:14
Speaker 4: and truly paid off.
41:15
Speaker 2: And how would today's money direst write her own relationship
41:18
Speaker 2: with money.
41:18
Speaker 4: I'd give myself definitely, like this time last year a D.
41:23
Speaker 4: I was really struggling. Like I said, as I said earlier,
41:26
Speaker 4: I was trying not to live paycheck to paycheck, but
41:28
Speaker 4: I essentially was living paycheck to paycheck. I didn't have
41:31
Speaker 4: any money in my savings account. I'd say now I
41:35
Speaker 4: would give myself a grade of a B because like,
41:38
Speaker 4: I'm still on my journey. I haven't reached that A
41:41
Speaker 4: plus stage yet where I've reached my financial goals.
41:44
Speaker 1: I really liked it. I felt like she had a
41:46
Speaker 1: lot of introspection and she felt like she was on
41:49
Speaker 1: the right journey. You know, she's obviously gone through a lot,
41:53
Speaker 1: and the amount of debt she was in obviously took
41:55
Speaker 1: her a little bit of time to rack up. So
41:57
Speaker 1: it's not something you can just get out of in
41:59
Speaker 1: the immediately. But I think that she's done a really
42:02
Speaker 1: good job and knowing that she's not living paycheck to
42:04
Speaker 1: paycheck anymore, like that is such an empowering feeling.
42:08
Speaker 2: Yeah, and we're so lucky that we do get to
42:09
Speaker 2: hear these stories being on the She's on the money
42:12
Speaker 2: Facebook group all the time they come through, don't they Like,
42:14
Speaker 2: we see the amazing things that people are doing. And
42:17
Speaker 2: to be honest, Victoria, a lot of that is to
42:19
Speaker 2: do with you, mate, Oh that's really finance. But also
42:22
Speaker 2: she's closed her after pay And I'd like to just
42:24
Speaker 2: point out here, like off topic of the Money Diary,
42:27
Speaker 2: I never told anybody to close their after pay accounts.
42:30
Speaker 2: Yet here you guys all are just saying, all right,
42:33
Speaker 2: I'm closing my account. I'm doing this, I'm doing that.
42:35
Speaker 1: All I said was spend more mindfully and if you can't,
42:39
Speaker 1: maybe consider not having it. And so you guys are all.
42:41
Speaker 2: Like, you're right, shut it down, shut it down.
42:44
Speaker 1: And you know what, I kind of love it because
42:46
Speaker 1: I feel like every single person that posts in our
42:48
Speaker 1: group a balance shutting down their after pay is really empowered.
42:52
Speaker 1: You can see it in the way that they're posting
42:54
Speaker 1: and how excited they are, and you Know twenty seven
42:57
Speaker 1: Healing and Learning said that she had an after pay diction,
43:00
Speaker 1: So I feel like maybe it was a really positive
43:02
Speaker 1: step for her. And I feel like all steps, no
43:05
Speaker 1: matter how small they are, actually really help us be
43:07
Speaker 1: alder secure our future financial life. And it seems like
43:11
Speaker 1: she's on the right track.
43:15
Speaker 2: And that is where we will leave it today, guys.
43:18
Speaker 2: But before we do head off, let's quickly wrap the
43:20
Speaker 2: boring but important stuff. The advice shed on she is
43:22
Speaker 2: on the money is general in nature and does not
43:24
Speaker 2: consider your individual circumstances. She's on the money exists purely
43:28
Speaker 2: for educational purposes and should not be relied upon to
43:31
Speaker 2: make an investment or a financial decision and stress less,
43:34
Speaker 2: we promise. Victoria Devine is an authorized representative of Australia
43:38
Speaker 2: Pacific Fund Management Preparatory Limited ABN three four one three
43:42
Speaker 2: two plus six three two five seven AFSL three three
43:45
Speaker 2: nine or one fifth one And as always, a massive
43:48
Speaker 2: shout out to our audio king Ryan John for putting
43:51
Speaker 2: together today's past.
43:52
Speaker 1: We would love it if you joined our Facebook group
43:54
Speaker 1: where our community shares money tips and trigs every single day,
43:58
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44:01
Speaker 1: and join us. If Facebook's not your thing, you can
44:03
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44:05
Speaker 1: a US and, as Georgia King pointed out last week,
44:09
Speaker 1: you can also now find us on YouTube, which is
44:12
Speaker 1: super exciting, incredible.
44:13
Speaker 2: We will see you guys, next to you, then guys