The ABCs Of HYIPs

This article neither endorses or condemns getting involved with an HYIP, but if you're going to put your money into one of these, you should at least know what you are getting into and what's involved. That way at least you will be prepared for what may or may not happen.

First of all, HYIP stands for High Yield Investment Program. This is a program where the member signs up and, depending on the program itself, has to perform some daily or weekly routine. This could be viewing a number of web sites each day to reading ads. Each HYIP is different so please read the terms of the one you plan on joining before you join it.

To make money with these programs, that is also going to be slightly different from program to program but there is a general way that these things work.

For the most part, these companies sell what they call ad packs. You purchase an ad pack and your site is then displayed somewhere on the site. These ad packs range in price from a few dollars to hundreds of dollars depending on the structure of the site. The higher the price of the ad pack, the more your site will get shown, usually.

After you have purchased your ad pack you then agree to the terms of the site to either read ads or view other sites, or whatever they have you do. During that time, your ad or site will be shown to other members. This gives you a chance to make sales from your site. However, the main lure of these programs is that after a certain number of days, your ad pack gives you a certain return on what you paid for it. The returns range all over the map. I've seen them as low as 3% to as high as 24%. The average return these days is about 12%, paid out usually within a couple of weeks.

So let's say you purchased an ad pack for $10. After 14 days, the site may pay 12% on that and give you a check or credit for $11.20. You can take your money and run, or put it back into the company and get another 12% on it in another 14 days. Obviously, the more money you spend on ad packs the more you will get back.

You're probably wondering where they get the money to pay you 12% when most banks in the US today at best are paying you 3% in a month? Well, they get the money from several sources. One of them is outside advertising, but the main source is from members that come in after you. They pay you from their ad pack purchases.

This system works fine as long as new members keep coming in. Historically, however, as soon as there are problems in making payouts, membership slows, then stops and then the company folds. No HYIP to date has lasted more than a year, if that long.

HYIPs are risky because of this, but you can make a decent amount if you get in early and buy large ad packs, or whatever your site calls it. In the US, the federal government, for the most part has ruled that these HYIPs are illegal if they can't show a viable product. Other countries don't have such strict regulations.

Before getting involved with an HYIP, do your research on the company. Never spend more than you can afford to lose, as these can be risky.

Steven Wagenheim, the author of this article, has ghost written over 1000 articles for the Internet. His Honest Income Program can be found at:

http://www.honestincomeprogram.com/