By Babajide Komolafe

There are people that know they need to invest but they are afraid of losing money. The fear is fuelled by stories of friends, relatives or colleagues who had lost money in one investment or the other.   But there are also stories of people who invested and did not lose money. To achieve this, all you need to do is observe the five basic laws of money.

Three of the laws reveal what to do or not do to avoid losing money in investment. The last two editions focused on two of these three laws i.e. Money stays with those who entrust it to wise people; Money is lost when invested in things you are not familiar with.

According to the third law, Money is lost at a fast rate when invested in  ‘Get Rich Quick’ Schemes. Why?
You need to understand that there is nothing like ‘Get Rich Quick’. When you study the lives of people celebrated today as the richest people in the world, you would realize that none of them achieved it overnight or even in a year.

For example, it took our own Alhaji Aliko Dangote, 30 years of hard work in the challenging world of business before he became the richest man in Africa. The reality is that besides those who inherited their wealth, none of the top richest people in the world achieved it in a jiffy or through jackpot. Until you acknowledge this fact, you are not ready to be rich.

Secondly, what is referred to as ‘Get Rich Quick’ schemes are actually ‘Lose Money Quick’ schemes. They are designed by dubious and fraudulent people to rob people of their hard earned money. To achieve this, the schemes are designed to exploit the natural desire inherent in man     for quick and huge returns. So they offer mouth watering returns or profit within a very short period. For example, banks offer interest rate to attract deposits from customers and the interest is usually paid at the end of the term of the deposit.

However, in the late 1990s when there was proliferation of banks and finance companies, some of them started offering mouth watering interest rates like 30 percent, and they offer to pay the interest upfront. Many people where attracted, not knowing that the financial institutions offering such interest were not well managed and had became distressed. The result was that the money deposited in such institutions was trapped when the authorities withdrew their license.

To avoid a similar fate, you must beware of any scheme, business or investment that offers huge returns within a short period. It does not matter how many people are patronizing such scheme or their testimony. If it offers what is far above what other similar  businesses or investment is offering and it offers to deliver it within a short period of time, run away from it. The huge, quick return is actually a bait to make you lose your money faster than you can ever imagine.