Make Extra Cash with Direct Sales and Boost Retirement Savings.

This post on direct sales contains affiliate links. If you click on a link and make a purchase, I will receive an affiliate commission at no extra cost to you. Please read my disclosure page for more info.

As a side hustle, direct sales might be just the ticket to help you generate the extra cash needed to boost your retirement savings.  Like anything else though, making more money takes real work.

This article is your guide to the benefits of direct sales and network marketing.  It will also help you recognize how to avoid pyramid schemes so that you can add to your retirement fund, not deplete it!

Direct sales – is it for you? More people than ever are embracing direct sales, and that number is growing every year.  Ever wonder why?

Participation in a direct sales or network marketing company allows you to purchase products you love at a discount, which is a great benefit all by itself.  You may be more enticed, though, by the flexible hours, the opportunity to call your own shots, and the chance to make some extra money.

Direct sales offers the opportunity to increase your income by selling directly to others through face-to-face sales. Or you might prefer selling online. Some direct sellers promote their products by writing gift guides which they publish online and share on social media.

What’s the difference between direct sales, network marketing, and pyramid schemes? 

Let’s break it down . . .

Direct Sales

According to the Direct Selling Association, direct selling is the practice of marketing goods and services directly to customers, by independent sales people.

This is face-to-face, or person-to-person selling.  It can involve door-to-door sales, party plan selling, pop-up boutique sales, and larger events.

Direct sales often include sales of durable goods that are designed to last, such as water filters, cookware, fine art, etc.  You make one sale and move on to the next customer.

Direct sales of durable goods can offer higher commissions.

Network Marketing

Also a type of direct selling, network marketing has a slightly different compensation structure.  In network marketing, more of the profits are shared with those above you and used for bonuses.  You have to sell more to make more.

Yet network marketing offers a greater opportunity for residual income as many of the products sold are consumable, such as nutritional supplements, food, personal care products, etc.  The same customer may re-order their favorite products from your website over and over.

Both direct sales and network marketing allow you to grow a sales team under you, if desired, by sponsoring others into the business.  Basically, a new salesperson joins under you and begins selling products, too.  You earn bonuses and a percentage of the sales made by your team.

Pyramid Schemes

A pyramid scheme is an illegal investment that relies on getting a large number of “investors” who contribute money and then recruit others to do the same.  If you’re one of the earliest investors, you’ll get a payout, but if you’re one of the last investors you’ll be left holding the (empty) bag.

For example, a friend once offered to let me in on an opportunity to “invest” $5,000 in a supportive women’s circle. Each woman in the circle would recruit other women. At some point, I would receive money, just for being a part of the circle. No products were being sold, and I was cautioned not to tell my husband – both big red flags!

No products are sold through pyramid schemes.

OK, so now we know that direct sales and network marketing are all about selling real products that people can consume or use, by independent salespeople.

What are the benefits of joining a direct sales or network marketing company?

Make more money!

The perfect side hustle, direct sales offers you the chance to make a little or a lot of money.  Use that extra cash to help pay down debt, or to supplement your household budget. If you are behind in saving for retirement, you could even use it to help grow your retirement savings.

Be your own boss.

Getting into direct sales gives you the flexibility of working from home, on your own schedule.  You can do it full-time or part-time.

Purchase products you love at a discount!

You might want to join some companies just for the discount and never grow a business.  Saving money on items you’d purchase anyway is a good way to redirect cash into your retirement account!

Make new friends.

You’ll meet new people who share your values, and it’s fun to network with others!  I’ve made some life-long friends this way.

Not a social butterfly?  No problem.

Most direct sales companies provide you with an affiliate website so you can make money online. Social media has made it very easy to share and sell online.  You can start a blog and gain exposure through Twitter, Instagram, Pinterest, Facebook, and more.

Check out my friend Karen Clark’s site if you’d like to learn how to effectively and ethically market online.  Karen blogs about social media for direct sellers at My Business Presence.

Her two books, Social Media for Direct Selling Representatives: Ethical and Effective Online Marketing (Volume 1) and Social Media for Direct Selling Leaders: Growing and Supporting Your Team Online are invaluable resources.

Personal development.

I have learned about myself and grown as a person through direct selling.  I've also increased my leadership skills and improved my public speaking abilities, which has helped me in my primary profession as a social worker.

Personal experience in direct sales.

I can speak from experience that direct sales can be a rewarding and lucrative side hustle.  Years ago, I had a lot of fun selling fine art.  Later, I became an independent representative for Miessence organic products, selling at home parties and events.

Now that Miessence has switched to an affiliate sales model, I find it easier to make sales via social media and through affiliate links on my blog. It's another income stream that helps me catch up retirement savings!

Are there any downsides to joining a direct sales company?

Things to look out for include questionable marketing information, restrictions about how you are allowed to market products, pressure to buy more inventory, and hidden costs to you as the seller.

It's important to do your due diligence.  Research any company you decide to join and make sure you understand their policies and procedures, and the compensation plan.  You want to know how and when you will be paid, right?

Questions to ask before joining a direct sales company include:

Do I have to purchase a kit or a certain amount of inventory to get started?

Many companies have starter kits, but it should not be mandatory to get one.  Lots of companies will drop ship directly to the customer, and you won't have to stock a large inventory yourself.

Do I have to make my own minimum purchase each month to stay "active" in order to qualify for commissions and bonuses?

Possibly.  If this is the case, make sure these are products you love and really want to buy. If you are required to purchase more than you can use, this might not be the right company for you.

Are there any fees associated with getting paid that would reduce my profits in direct sales?

I was surprised to learn that some companies charge direct sellers a fee to process their commission checks.  This is unnecessary and unreasonable.

Final thoughts on direct sales.

If you want to get started in direct sales or network marketing, don't expect to get rich overnight.   However, you can legitimately make serious extra money to boost your retirement savings if you put in the effort.

It takes a lot of hard work and a considerable time commitment to build up a customer base and keep those sales coming in.  If you decide to build a team of other direct sellers or network marketers under you, that also requires considerable effort on your part.

Your success in direct sales will vary depending on the reasons for becoming or staying involved.  Those reasons are different for everyone, but if you have  a strong "why"  you will be ahead of the game. Follow your values when starting a side hustle.

Find a product you are passionate about and enjoy sharing with others, and direct sales can be a great way to make some extra money to boost your retirement savings. Growing your direct sales business takes work, but the rewards can be great.

Question: What are YOUR thoughts about direct sales?  Let us know in the comments below.

Pin It For Later!