April 3, 2007 -- While we're focused on making money, it's also important to note how to avoid losing it, too.
I responded to ads to stuff envelopes that boasted the potential to earn up to $1,500 a week with little effort. Though I was highly skeptical, I bought a dozen different starter kits for $20 to $50 each, figuring one might work.
Each instructed me to mail flyers aimed at recruiting other people to stuff envelopes. I wasn't promoting a product or service; I was just told to get other people to stuff envelopes with the same offer. If they purchased the same kit, I'd receive a commission.
I'm pretty resourceful, yet I couldn't get this to pan out. I didn't get a single cent. Recruiting people to stuff envelopes is the oldest work-from-home gimmick and it fools new people every day. Don't be one of them.
Christine Durst, author of "The Rat Race Rebellion," says her research indicates the ratio of scams to legitimate opportunities is 42-to-1.
That isn't to say that all home-based opportunities that request money up front are rip-offs. Many legitimate direct-sales companies and others that help you start your own business require a start-up fee to cover the cost of training manuals and supplies to get you going.
Before mailing a check or submitting a credit card payment, talk to a live person about the requirements and the realistic earning potential. Also ask about obstacles and challenges.
If you wanted to become a consultant with Mary Kay or Avon, you'd have no trouble finding people willing to talk -- not just e-mail you -- about how to get started. The same access to information and people should be your standard for any home-based work you consider.
If you are going to send money, ask first about a money-back guarantee. Specifically, find out how you'll have to go about requesting a refund if you're not satisfied and when you'll receive it.
This is especially important for Web sites that require a registration fee for access to listings or for sites that want to sell you an "information packet" or "starter kit."
Check with the Better Business Bureau for any complaints about the company and try to verify the seller's PayPal record. (Similarly, if you have been scammed, be sure to report the nature of your complaint to these outlets as well.)
Do not reveal passwords or personal information. Once you've accepted a job and you opt for direct deposit, you'll have to provide your bank account number, but this information isn't relevant in the application process.
Beyond that, you should never reveal passwords and PINs for banking information or PayPal accounts, even though many online scams request these details. They claim they're only requesting it to determine whether you're an honest applicant. Don't fall for that nonsense.
Remember that just because an ad or posting appears on a seemingly reputable Web site doesn't mean the opportunity has been verified for legitimacy. The big job boards and a wide range of work-from-home Web sites are rich in resources. Yet they often feature ads and links that aren't vetted for accuracy.
With an abundance of opportunities out there, no single source can possibly verify the validity of every opportunity. You must do your own research, inject a big dose of common sense, and follow the advice here to avoid getting ripped off.
Even with all of these warnings, the reality is that good, honest opportunities exist. Just do your homework to make sure it's right for you before signing on.