Some multilevel marketing plans are legitimate. However, others are illegal pyramid schemes. In pyramids, commissions are based on the number of distributors recruited.

Most of the product sales are made to these distributors, not to consumers in general. The underlying goods and services, which vary from vitamins to car leases, serve only to make the schemes look legitimate. Most people end up with nothing to show for their money except the expensive products or marketing materials they were pressured to buy.

If you're thinking about joining what appears to be a legitimate multilevel marketing plan, take time to learn about the plan.

• What is the company's track record?
• How long has the company been in business?
• What products does it sell?
• Does it sell products to the public-at-large?
• Does it have evidence to back up the claims it makes about its product?
• Is the product competitively priced?
• Is it likely to appeal to a large customer base?
• How much does it cost to join the plan?
• Are minimum monthly sales required to earn a commission?
• Will you be required to recruit new distributors to earn your commission?