Facts, opinions, and the real story behind Mary Kay Cosmetics.

The Pre-Paid Legal Compensation Plan

Do you think your multi-level marketing company makes it hard for participants to earn a living? Well you haven’t seen Pre-Paid Legal! It’s next to impossible for an associate to earn a real living selling their “plans” to unsuspecting customers. Here are the numbers… 

Below is a screenshot of the Pre-Paid Legal website as of April 8, 2008. The plan for selling memberships is simple. If you sell a membership that costs the customer $26 a month, they say you can be paid $50 to $182.5 for that membership. (Althoug the chart shows $25 is actually paid out to the lowest level associates, where most of the PPL reps sit.)

The money paid out is an advance against future commissions. So you might receive $50, but that is all you will get for that membership for the whole year.

But here’s the catch that they don’t tell you: 50% of people who buy PPL memberships cancel them within the first year. Chances are, you’ll have to pay back some of that advance.  How lucrative is that?

This document gives more information about the commission structure, but still you see that unless you recruit, you’re going to be stuck at $25 per plan you sell. And that’s your payout for the entire year on that plan (while you cross your fingers and hope the person doesn’t cancel!).