Ask Stacy: Should I Invest in ‘Freedom Checks’?

Women w money
Photo by Dean Drobot / Shutterstock.com

Welcome to “Ask Stacy,” a short video feature answering money questions submitted by readers and viewers. You can learn how to send in a question of your own below.

If you’re not typically a video watcher, give it a try. These videos are short and painless, and you’ll learn something valuable. But if you can’t deal with video, no problem: Just scroll down this page for the full transcript of the video, as well as some reader resources.

Today’s question is about a heavily advertised investment program called “Freedom Checks.” On its website, the first thing you’ll see is this line:

See How to Collect $24,075 … $66,570 … and even $160,923 beginning today!

Next, there’s a video showing pictures of people from all the over the country who are cashing their “freedom checks” for tens of thousands of dollars.

Should we bite? You probably already know the answer. But in this video, I not only explain the story behind “freedom checks,” but also offer a little advice you can use whenever confronted with any tempting opportunity.

For more information on this topic, check out “10 Golden Rules to Avoid Getting Scammed” and “10 Types of People Who Fall for Scams, Schemes and Cons.” You can also go to the search at the top of this page, put in the words “scam” or “rip-off” and find plenty of information on just about everything relating to this topic.

Got a question of your own to ask? Scroll down past the transcript.

Don’t want to watch? Here’s what I said in the video

Hello, everyone, and welcome to your money Q&A question of the day. I’m your host, Stacy Johnson, and this answer is brought to you by MoneyTalksNews.com, serving up the best personal finance news and advice since 1991.

Our question of the day comes from Carrie:

I heard something about Freedom Checks on the radio. Is that some kind of hoax?

I’d heard of “Freedom Checks” before as well. If you go to their website — which I don’t advise — you’ll find plenty of explanation points. It explains how you can get your own Freedom Checks, then throws around numbers. “See how to collect $24,075, $66,570, and $160,923 beginning today!”

Before we continue, let me explain something: There are two kinds of scams in the world. One is when somebody says something completely false. In other words, they lie to steal your money. The other kind is what I believe this claim to be: over-hyping something that’s technically true to make it sound more compelling than it actually is.

What these guys are ultimately trying to do is sell you advice on something called master limited partnerships, or MLPs, which are a kind of stock that tends to pay high dividends. There’s no secret; they’ve been around for a long time.

As for the claims of giant checks: Sure, you can get a “Freedom Check” for $24,075. But what you’re not hearing in the pitch is that in order to get that check, you’ll have to invest $300,000 into stocks paying 8 percent dividends.

Bottom line: While “Freedom Checks” are technically possible, you’re not getting the whole story in the pitch. This is an example of someone taking an old idea, wrapping it in new packaging, then using a lot of explanation points and implying something secret, new and exciting has been discovered.

Here’s a good rule of thumb. When you see exclamation points, be cautious. In fact, the more exclamation points you see, the less tempted you should be. There are a lot of people shouting about how they’re going to make you all kinds of money. Don’t believe them. Use your head. If I had a secret way to make monster money, what do you think I’d do: Shut up, keep it secret, and make myself rich? Or, pay for a bunch of advertising to sell it to you?

Whenever confronted with any investment pitch, always do an online search. Go to your favorite search engine and put in the words, “complaints [name of product]” or “reviews [name of product].” Then decide. You’ll find things with lots of exclamation points are rarely worth your time and certainly not worth your money.

That’s all we’ve got for today. Lets end with our quote of the day. This one comes from one of my favorite guys, Warren Buffett, the legendary investor, and it’s appropriate to today’s topic.

“Rule number one, never lose money. Rule number two, never forget rule number one.”

Have a super-profitable day, and meet me here next time!

Got a question you’d like answered?

You can ask a question simply by hitting “reply” to our email newsletter, just as you would any email in your inbox. If you’re not subscribed, fix that right now by clicking here. It’s free, only takes a few seconds, and will get you valuable information every day!

The questions I’m likeliest to answer are those that will interest other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.

About me

I founded Money Talks News in 1991. I’m a CPA, and have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.

Got any words of wisdom you can offer on today’s question? Share your knowledge and experiences on our Facebook page. And if you find this information useful, please share it!

Got more money questions? Browse lots more Ask Stacy answers here.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
How to Avoid Being Surprised by 7 Nasty Expenses
How to Avoid Being Surprised by 7 Nasty Expenses

Major expenses are difficult to predict, but there are ways to make sure you’re protected.

9 Affordable Ways to Make Your Home Look Expensive
9 Affordable Ways to Make Your Home Look Expensive

These products from Amazon add elegance to your home without the expense.

9 Ways to Boost Your Home’s Curb Appeal for Less Than $50
9 Ways to Boost Your Home’s Curb Appeal for Less Than $50

These products will instantly improve your home’s curb appeal without breaking the bank.

8 Products That Make It Easier to Get Fit
8 Products That Make It Easier to Get Fit

Amazon reviewers give high marks to these tools that can help you get in shape without a gym.

12 Ways to Never Pay Full Price for Anything
12 Ways to Never Pay Full Price for Anything

Stop paying retail prices. Here are plenty of ways around that.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

11 Things Retirees Should Always Buy at Costco
11 Things Retirees Should Always Buy at Costco

This leader in bulk shopping is a great place to find discounts in the fixed-income years.

Over 50? The CDC Says You Need These 4 Vaccines
Over 50? The CDC Says You Need These 4 Vaccines

Fall is the time to schedule vaccines that can keep you healthy — and even save your life.

The 15 Worst States for Retirees in 2020
The 15 Worst States for Retirees in 2020

Based on dozens of metrics tied to affordability, quality of life and health care, these are not ideal places to spend retirement.

11 Household Items That Go Bad — or Become Dangerous
11 Household Items That Go Bad — or Become Dangerous

When you get the impulse to stockpile these everyday items, pay close attention to their expiration dates.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

8 Things You Can Get for Free at Pharmacies
8 Things You Can Get for Free at Pharmacies

In this age of higher-priced drugs and complex health care systems, a trip to the pharmacy can spark worry. Freebies sure do help.

This Is the Cheapest Place to Buy a Used Car
This Is the Cheapest Place to Buy a Used Car

Looking for a good deal on a set of wheels? This should be your first stop.

These Are the 4 Best Medicare Advantage Plans for 2020
These Are the 4 Best Medicare Advantage Plans for 2020

Medicare Advantage customers themselves rate these plans highest.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

The 10 Most Commonly Stolen Vehicles in America
The 10 Most Commonly Stolen Vehicles in America

A new model parks atop the list of vehicles that thieves love to pilfer.

10 Things the Pandemic Is Making Obsolete
10 Things the Pandemic Is Making Obsolete

Even if a COVID-19 vaccine is discovered tomorrow, it’s unlikely we will ever return to these ways of life.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

26 States That Do Not Tax Social Security Income
26 States That Do Not Tax Social Security Income

These states won’t tax any of your Social Security income — and in some cases, other types of retirement income.

Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?
Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?

You could save more than $30,000 by setting aside these costly expenses for just one year.

5 Keys to Making Your Car Last for 200,000 Miles
5 Keys to Making Your Car Last for 200,000 Miles

Pushing your car to 200,000 miles — and beyond — can save you piles of cash. Here’s how to get there.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

10 Reasons Why You Should Actually Retire at 62
10 Reasons Why You Should Actually Retire at 62

If you can, here are several good reasons to retire earlier than we’re told to.

5 Things That Make Life More Meaningful for Retirees
5 Things That Make Life More Meaningful for Retirees

Retirees agree: These are the things that give them purpose and fulfillment in their golden years.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.