Can Network Marketing Make You Rich?

Can network marketing make you rich? The short answer is…

Yes!

There are roughly 500 network marketers across the globe earning over a million dollars per year.

Considering that there are over 100 million network marketers, that might not sound like a lot.

But the reality is, there are tens of thousands of network marketing professionals globally that are earning over $100,000 per year, just from their home business.

That’s more than the average full time income in all of the richest countries in the world.

But look, having a hundred grand in your bank account doesn’t make you rich.

It’s just not the kind of money that will give you financial freedom and allow you to quit your job and live a life of freedom…

Unless you do the right thing with that money.

Before we talk about what the heck you should do with your MLM earnings, let’s define what “rich” might mean.

What Is “Rich” Anyway?

One of the mistakes most of us make is thinking that a certain amount of money will make you happy.

You set an income goal or savings target. And you think that when your bank account reaches that magic number, you will be completely satisfied and will no longer feel the need to make more.

This is wrong.

Because it’s not the money that you want.

Not really.

It’s the stuff or experiences that the money can get you.

Money is just a tool.

So before we talk about accumulating the tool called money, it’s important to understand that by historical standards, you’re already quite rich.

Filthy rich in fact.

Think about all the things you have in your life that you didn’t need to create yourself.

The nice smooth roads you drive on were created by someone else. The internet that you can access at a moment’s notice with all the abundance of information… all created by people you’ve never met.

The refrigerator that keeps your food good for longer.

The toilet! The value of the toilet can not be overstated.

And did you know that a lower class citizen in North America has a higher standard of living than King Henry VIII did? And he was the wealthiest king in British history.

Sure, ol’ Henry had tons of gold, fancy clothes, an abundance of food, and servants to boss around all day long.

But the dude didn’t even have a toilet. Or a car.

As humans, we tend to compare ourselves to those around us. So if your neighbor has a bigger house or a shinier car, you feel as though the neighbor is better off.

But let’s keep it in perspective. 

By historical standards, you are wealthy beyond belief.

Even right now, ⅔ of the planet lives on less than 2 dollars a day. We in the West are extremely fortunate and we would do well to remind ourselves of that from time to time.

All this doesn’t mean you can’t improve and move forward in your life and ambitions. But a feeling of abundance and gratitude will serve you well as you’re working towards financial abundance.

How To Get Rich

So we’ve established that broadly speaking, you’re already wealthy.

But you came here to find out how network marketing can make you rich, AKA financially independent.

In order to be financially independent, you need income. Because the definition of financial independence is this:

You never have to work again in order to live your life.

OK, but how the heck can you get there?

3 things:

1. Spend less than you make
2. Invest the difference
3. Re-invest your returns

1. Spend Less Than You Make

What a mind blowing piece of wisdom, right?

But you would be surprised by how many people actually spend more money than they make. 

This is not sustainable. You’ll find yourself in the not-too-distant future with an incredibly high credit card bill and maybe barely enough income to cover the minimum payments.

This is how many people live their lives.

They don’t think ahead.

So there are 2 things you can do in order to achieve this:

Either you cut back on your spending…

Or you increase your income. This is where network marketing comes in. We’ll talk more about that soon.

2. Invest The Difference

You need a money machine. You need to make your money work for you, rather than you working for your money.

And investing is how you are going to build your money machine.

And it’s called a money machine because the goal of your investments is not just to accumulate a large dollar amount…

You’re not investing to accumulate assets.

You’re investing to create income.

When your investment account reaches a certain size, called critical mass, it will start growing at a faster rate every year than what you need to live on.

At this point, you will have achieved financial independence.

Because your investments will be producing so much income that it will completely pay for your necessities and desired lifestyle… and then some.

You will be earning more than you spend, without a job.

3. Re-invest Your Returns

You may be tempted to start drawing down your investment account when you get the itch to buy a new car, or some other trinket.

You must resist this urge, because it will hinder the long term growth of your money machine in a major way.

It will keep you from taking advantage of the true power of investing… compound interest.

To understand compound interest, I’m going to use an explanation that Jeff Booth used in his book, The Price Of Tomorrow.

I think this does an excellent job of illustrating the power of compounding. It’s not a concept that our brains intuitively grasp. The numbers just become so ridiculous so fast.

And obviously, these numbers are not going to exactly line up with your investments, because you’re not going to double your money year after year.

Over the last century or so, the stock market has averaged roughly 8% annual returns.

So let’s say that you were able to set aside $1000 per month for 30 years. Using the compound interest calculator at Investor.gov, you can quickly and easily find out how much money you would have after 30 years.

You can see that even though you only put in a total of $360,000, the total value of your investment account would sit at over $1.3 million.

What if you could manage to keep investing for another 5 years?

You would now have over $2 million dollars.

$2 million dollars would produce an average annual income of $160,000.

Most average households in North America could comfortably live on $160k per year.

But, I Don’t Have Money To Invest…

I know what you’re thinking…

This all sounds great. But I don’t have a grand to invest every single month.

Unfortunately, most people don’t.

Too many people are relying on government pensions and other benefits to pay for their lifestyle after retirement.

This is a bad idea.

As I’m writing this in the middle of 2022, the US government has over $30 trillion in debt… and that’s growing. 

Fast.

The government is running a deficit year after year, and they’re simply printing the money out of thin air in order to pay for their expenses.

This causes inflation, which devalues the purchasing power of your money. Ever notice how your paycheck seems to buy less stuff as the years go by? Even after your regular raises?

You can thank your government for that.

And if we factor in unfunded liabilities (things that the government has promised to pay for, but has yet to do so) such as Medicare and social security, they will owe $170 trillion in the coming years.

Let’s put that number into perspective. 170 trillion seconds is equal to 5.3 million years! That’s a big, big number. Dinosaurs were roaming the earth back then. Think about that for a second.

So either the government will simply not be able to pay these benefits out, or they will print the money. And devalue YOUR money in the process.

Here’s the reason I tell you this:

You can not rely on the government to take care of you. 

You need to take responsibility for your own future, because governments are not reliable enough to depend on. Especially when it comes to money.

So as we talked about earlier, you need to either cut your monthly expenses so that you can afford to invest…

Or you can choose to raise your income.

How MLM Can Help You Get Rich

You may be thinking about getting into network marketing to replace your job and “fire” your boss.

Or perhaps you simply want to make some money on the side, because you love your job. You just need more income so that you can secure your future.

Either way is perfectly fine.

But I believe that no matter what you decide to do for a living, you should consider doing network marketing in addition to that.

Because it’s another way to take advantage of compounding.

In network marketing, you would be responsible for selling products directly to consumers. You would earn a commission for every sale you make.

But you also have the opportunity to build your own network of sellers that will build their own networks… all of which will be selling products and earning you income.

If you successfully build a network marketing business, your team will grow exponentially over time.

I’m sure you’ve heard this before…

But if you recruit 5, and each of those recruits 5, and each of those recruits 5… by the seventh generation, your team would have a whopping 78,000 members in your organization.

Obviously the numbers will not work out that nicely in practice. Most of your team members will never recruit 5 people, but some will recruit way more than 5.

What matters is that if you are able to build your network marketing business effectively and create duplication within your organization, it’s just another area of your life where you can take advantage of exponential growth AKA compounding.

Many experts think that network marketing has created more millionaires than any other profession in human history, with the possible exception of real estate.

MLM an excellent model to create cash flow.

Which is what you will need in order to invest in your future, secure your retirement, and achieve financial independence.

You can use your network marketing cash flow to invest in assets that will likely grow over time or retain purchasing power as governments devalue your money. Such as:

• Real estate
• Gold
• Bitcoin
• Stock index funds

We’re not going to talk about asset allocation and how you should be diversifying your investments today. You will probably be best served finding a financial advisor that you trust to help you with this.

The reality is, network marketing is one of the few opportunities left for the middle and working class to get ahead long term. 

You have the opportunity to build a passive income stream where you can leverage the efforts of a large group of people… and use that income to invest in assets that will serve to build your money machine.

Look, the top earners in network marketing make millions of dollars. It’s important to understand that most people don’t get to this top level income due to various reasons.

But you don’t need an income of millions of dollars.

Remember when we talked about investing $1000 per month for 30 years?

You only need to make an extra few thousand per month in order to build a money machine that will one day allow you live a life of freedom.

Do People Actually Make Money In MLM?

The income statistics are a bit mixed when it comes to network marketing. Most sources report that 25% of network marketers make money. But the FTC claims that 99% of network marketers lose money.

Either way, it looks as though most people trying to build an MLM business don’t make it…

But you have to be very careful with statistics.

The numbers need to be put into context.

There are well over 100 million network marketing participants in the world. 

And according to polling data, 82% of those people report good or very good experiences with network marketing. 

How can that make sense if the vast majority lose money?

Well, many people who start a network marketing business but later decide that the business model isn’t a good fit for them actually remain customers with their chosen company.

They keep their membership active in order to receive discounts on their products (similar to Costco membership).

But the statistics don’t differentiate between active business builders and customers.

This skews the numbers, making it appear as though most people are utterly failing. 

When in reality, they simply decided not to build the business. But they didn’t actually have a negative experience.

So can network marketing make you rich?

According to the numbers, many folks are making good money.

Globally, the network marketing industry brings in roughly $189 billion per year. 

Of that $189 billion, roughly 40% is paid out in commissions to distributors. That comes out to over $70 billion going to regular, every-day folks just building a side hustle from their home.

That’s more money than the music industry and the National Football League combined.

But don’t the people at the top make all the money?

OK, let’s look at some more numbers.

There are roughly 500 network marketers in the world earning over $1 million per year. Let’s be conservative and round it up to an average of $2 million.

That only accounts for $1 billion. 

This means that over $69 billion in network marketing commissions are being paid out to people who are not seven figure earners.

Just normal every-day folks earning good money with network marketing.

Don’t forget, 82% of network marketing participants reported a good or very good experience.

How To Succeed With MLM

I wanna be very clear…

Yes. you can use network marketing as a way to get rich or more accurately, financially independent.

But it’s not going to be easy.

It’s going to take hard work, dedication, commitment, and frankly a thick skin.

Before we talk about how to succeed with this business, a quick explanation of how the business model works.

How MLM Works

The network marketing business model is actually not that different from a traditional business.

Revenue is created when products or services are sold to people in the economy.

The difference is the way in which the products are marketed and distributed to customers.

Instead of spending millions on advertising campaigns and retail fees, a network marketing company uses a network of independent distributors to create sales volume.

Not only does this provide an opportunity for working class folks to build an extraordinary income stream, but it’s also perfectly efficient for the company.

Because when sales volume isn’t produced, commissions don’t get paid out.

It’s a win-win all around.

As an independent distributor, you will be tasked with selling your products. You will earn a commission for every sale you make.

You will also be able to build a network of distributors who will build their own networks and sell products. And you can earn income from the efforts of people that you personally bring in, as well as from those who are deeper in the network.

This can create exponential growth in your organization if done correctly.

How To Do It

Many people think that recruiting a ton of reps is the end-all-be-all for success in network marketing.

This isn’t exactly true. 

You need to strike a balance between acquiring loyal customers and serious business builders.

Because if everyone in your team is solely focused on recruiting but nobody ever sells a product, then no money is made.

Remember, revenue is produced from sales volume, not recruitment.

The whole point of building a team of business builders is so that you don’t have to create all of the sales volume yourself.

You can create a large network of people who do most of the selling for you.

But you need to play your part.

Duplication Is Key

The top earners in network marketing don’t recruit as many people as you think.

Instead, they make sure that the people they do recruit actually duplicate the process that leads to recruitment and customer acquisition.

When you join a network marketing business, you will be taught a system.

A process that others have used to become successful in the business.

And if you want long term success in the business, it will be important for you to trust the process that you’re taught.

Because it has been created with simplicity and duplication in mind.

When you bring in a new business builder and she sees that you’re having success by simply following the same system that everyone else is using, she will see that all she needs to do is follow that same system.

But if you get fancy, it will be hard for your team to understand exactly what you’re doing.

These people will be looking to you for leadership, and if you’re not following a duplicable system, you will lose members faster than you can replace them.

For example, if you go out and learn how to do high pressure closing, you might be able to recruit nearly every person you talk to.

But they won’t be able to duplicate what you’ve done.

And they will drop like flies. 

You will be forced to constantly replenish your team. You’ve effectively got yourself a low paying sales job.

So keep it simple and build in such a way that most people will be able to replicate.

This is how you build deep, long lasting, profitable network marketing organizations.

Don’t Get Caught In Internet Rabbit Holes

As we talked about already, network marketing is not easy. If it was, everyone would be doing it, right?

When you inevitably run into challenges, I urge you to reach out to your business leaders for help rather than turning to the internet.

The internet is full of distractions, rabbit holes, and skilled sales people that will distract you from your mission of creating a passive network marketing income stream.

There is, however, a place for the internet in this business.

Once you’ve built your organization to the point where you’re starting to see some duplication and earning consistent income, it’s not a bad idea to turn to the internet to expand your business.

Internet marketing can be a great way to build a personal brand and attract more folks to you.

Just don’t do it prematurely.

With everything you do in your network marketing business, you should be keeping duplication in mind.

The following articles should help you to understand what it takes to make it in this business:

• What Is Network Marketing
• MLM Success Guide
• Guide To Duplication
• Digital Network Marketing
• Network Marketing On Social Media
• Network Marketing FAQ

Why Most People Quit MLM

We talked about how most people who quit building an MLM business decide to stick around as customers.

But why did they give up on the business in the first place?

The answer is very simple:

They were sold a false bill of goods.

One of the problems with network marketing is that many people who are recruiting for their business are a bit over-enthusiastic with their claims.

They don’t tell the full story.

They talk about the massive income potential and how it’s possible to earn millions of dollars with this business model.

While that’s true, it’s not the norm.

This causes many people to join network marketing with unrealistically high expectations.

And when they’ve made almost no money in their first year, they decide that the business isn’t a good fit for them.

This is why I want to be very clear:

The business will not be easy.

You need to understand what you’re getting into so that you will be able to play the long game and persevere when the tough times inevitably come.

Let’s Wrap This Up

Can network marketing make you rich?

Absolutely.

But as we talked about earlier, you should be spending less than you make and investing the difference in order to create that money machine that will pay you… whether you’re working or not.

You may want to have a look at our article where we outline how to become financially free.

The point is, you do not need to become a top earner in MLM to get rich.

Network marketing is just another income source that can contribute to that money machine.

Yes, it could certainly replace your job too, if you do exceptionally well.

But if you build a massive income stream in network marketing and your company shuts down for whatever reason, your income disappears.

Unless you’ve built that diversified money machine we talked about earlier.

Can network marketing make you rich?

Yes, but it’s only one piece of the pie.

There are many opinions on network marketing, and you may or may not agree. But I’ve made my case. If you want, you can make your case in the comments below.

Just be nice!