Last  up  date  27/10/20014 
Definition of

linear - Income

The income a person receives from the work s/he does.
     For this one needs to put in certain number of hours every week as work.

Definition of

Residual - Income
Most think of income as wages earned for a day's work, but residual income is different because it continues to pay out long after the initial effort of earning it has passed

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Most think of income as wages earned for a day's work.
        Residual income is different because it continues to
        pay out long after the initial effort of earning it has passed.

 Linear :   Income is an exchange of money for a devotion of time.
   An employer agrees to pay a worker a wage in exchange for certain
   enumerated services based on the employee's level of education or
   accumulated expertise within a given industry.
   How much the worker earns depends on the type of  employment.
   An employer may elect to pay an employee in a number of ways,
   including an hourly wage,
   a fixed salary or a commission wage based on total product sales.

Linear income is directly proportional to the number
  of hours invested in it
     (40 hrs. of pay for 40 hrs. of work)

Residual Income:
      Is a percentage of the profit generated from the sale of product.
      As the volume of product increases  with sales turnover within the network,
percentage of the profit generated from the product turnover will also increase.

Residual Income:
      is income that continues to be generated after the initial effort has been expended.
      Compare this to what most people focus on earning: linear income, which is
      "one-shot" compensation or payment in the form of a fee, wage, commission or salary.

Residual Income:  is that once things are set in motion,
     you continue making money from your initial efforts,
     while gaining time to devote to other things...
     such as generating more streams of residual income

What is Network marketing ?

  Also known as Multi-level marketing, is a form of marketing model that was started decades ago.
  The model uses direct sales to consumers through relations and word of mouth from the company’s team of marketers. In this marketing model,
  the employee is not only paid for the sales they make but also for successful referrals that they bring to the program or to the company.


What is Multi-level marketing?
  (MLM) is a marketing strategy in which the sales force is compensated not only for sales they generate,
  but also for the sales of the other salespeople that they recruit.
  This recruited sales force is referred to as the participant's "down line", and can provide multiple levels of compensation


What is Direct Selling?

  Direct selling is the sale of a consumer product or service, person-to-person, away from a fixed retail location,
   marketed through independent sales representatives who are sometimes also referred to as consultants, distributors or other titles.
   Direct sellers are not employees of the company. They are independent contractors who market and sell the products or services of
   a company in return for a commission on those sales.

A FRANCHISEE  pays an initial fee and ongoing royalties to a franchisor;
in return, the franchisee gains the use of a trademark, ongoing support from the franchisor,
and the right to use the franchisor's system of doing business and sell its products or services

Affiliate marketing at its very core is about relationships,
 A relationship between three parties: In the world of Affiliate marketing,
 an advertiser can be a company selling a product like electronics, airline tickets,
 clothing or car parts, or an advertiser could also be an insurance company selling policies.


What is A Pyramid Scheme?
 A pyramid scheme is an unsustainable business model that involves promising participants payment or services,
 primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public.
 That is, services are an example of intangible economic goods.             


What is   Chain mail

A typical chain letter includes names and addresses of several individuals whom you may or may not know.

You are instructed to send a certain amount of money--usually $5--to the person at the top of the list,

and then eliminate that name and add yours to the bottom.

You are then instructed to mail copies of the letter to a few more individuals who will hopefully repeat the entire process.

The letter promises that if they follow the same procedure, your name will gradually move to the top of the list and you'll receive money

lots of it.


Chain letters are simply low payment pyramid schemes in an envelope, so, like them,

they make money only for the first few on the list. All the others lose their money.








What is A Gifting club?
 Many Oregonians are being defrauded by unlawful pyramid schemes operating under the guise of so-called "gifting clubs"
 such as the Dinner Club or Women's Empowerment Network.
 These "clubs" are elaborate scams designed to make money for a few at the expense of many.

 The promoters of the scheme claim that IRS regulations allow people to "gift" one another up to $10,000 per year tax free.
 For example, persons are asked to pay $5,000 to enter at the bottom of the pyramid or "tree" along with others.
 As these people encourage others to join the club, they rise on the tree to the top position, where the total amount collected from
 "gifts" is $40,000, a $35,000 profit. Often, people at the top re-invest another $5,000 and start the process anew.

 Each of the eight persons just entering the tree delivers his/her $5,000 "gift" directly to the person at the top of the pyramid.
 This also helps convince new players that they will eventually receive a $35,000 return on their "gift."

 These schemes are doomed to failure. Each "tree" involves 8 persons who "gift" $5,000 each.
 The person at the top of the tree gets $40,000 and the other 7 people hope that enough players come on board to push them to the top.
 For each person at the top, there are 8 people who are likely to lose their investment and the chance of a big "payoff."
 Eventually, these schemes collapse because they run out of prospective participants.

 No matter what the promoters may tell you, gifting clubs are illegal. They are unlawful pyramid schemes.
 Gifting clubs and pyramids have not been approved by the Oregon Attorney General, local district attorneys,
 or the Division of Finance and Corporate Securities. Operating or participating in a pyramid scheme violates
 Oregon's Unlawful Trade Practices Act, which imposes civil penalties of up to $25,000 per violation.

 Gifting clubs and pyramid schemes may also violate Oregon securities laws by virtue of being investment contracts.
 Oregon law requires securities to be registered and licenses for persons engaged in transacting business in securities.
 A violation of the securities laws could subject a person to civil penalties of up to $20,000 per violation, or criminal prosecution as a class B felony.

 The IRS does not recognize gifting clubs or pyramid schemes and considers all money gained from these schemes to be reportable income.
 Failing to report income from pyramid schemes on your tax return,
 or attempting to hide such monies may subject you to severe federal civil and criminal penalties.