Docy

Pareto’s Principle 80/20

Estimated reading: 2 minutes
Some say…

“I don’t like network marketing because only a few make the BIG MONEY and most do not.”

I’d say

“You must HATE planet Earth (the planet we live on)”

Why?

  • Less than 1% of the people on planet earth are wealthy
  • Only 1% of the people in America (the richest country) are wealthy
  • Only 4% are financially independent
  • 95% are struggling financially

The Pareto principle

The Pareto principle states that for many outcomes, roughly 80% of consequences come from 20% of causes.  This is also known as the 80/20 rule and the Law of the Few.

  • 80% of the money is controlled by 20% of the people
  • So if 100 people had a combined wealth of $1 Million Dollars
  • $200,000 is owned by 80 people
  • $800,000 is owned by 20 people

Of the top 20% you will see an 80/20 ratio again.

20 People

own $800,000 of the original
$1 Million  

  • 20% = 4 people own $640,000 (80% of $800,000)
  • 80% = 16 people own $160,000 (20% of $800,000)
100 People

own $1,000,000

  • 4 out of 100 people (4%) own $640,0000 (64%)

This ratio has NOT changed in 1,000’s of years and in every type of economy

Next - Psychology of Recruiting Law of the Few: Be the Exception
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