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Home Business, or Scam?

Is that new work-from-home opportunity for real? Here are 4 ways to tell.

The e-mail inboxes of web-savvy parents are often flooded with home business scams. We're prime targets. We know our way around a computer keyboard, and we love to spend time with our kids, so we're marked for every home-business opportunity in the book.

And it's true: A lot of us would love nothing more than to make money and stay at home. That's why even though we know we can smell a rat a mile away, we're sometimes tempted – even by those less-than-reputable (and less-than-ethical) companies that rely on SPAM to get the word out.

Here are four tips to help you avoid the scams and find the right home-based business opportunity for you:

1. Too Good to Be True?

If it sounds too good to be true, it probably is. If you find an opportunity for which you can make a lot of money without spending any time working, move on to the next opportunity.

2. Vague Headlines

"Tammy made $4,000 in her first month. So can you." First of all, who is Tammy? Testimonials that are difficult to verify may not be legitimate. If the ad only gives first names and photographs of people holding scads of cash, be careful. If Tammy is a legitimate home-working entrepreneur, it's possible that she made that $4,000 in her first month – and significantly less after that time period.

Also be wary of companies that offer to sell you lists of companies who are looking for homeworkers. A friend of mine once shelled out $95 for such a list, which turned out to be a listing straight from her yellow pages. When she contacted these businesses, she discovered that they were neither looking for homeworkers nor did they agree to be listed in such a book.

3. The Overhyped

Be leery if there is a strict time limit for investing in a business opportunity. Scammers know that the faster you act, the less you think (and research). And if this is a fly-by-night company, these time limits provide a better opportunity to take the money and run.

Also, don't get too excited about deep discounts on starting costs. More costs may come later. And keep in mind that, in many states, the government does not regulate business opportunities with investments of less than $500. Some of the worst scams may fall into this category.

4. Research

Use your knowledge of the Internet to avoid being scammed. Check for listings with the National Fraud Information Center, as well as the Better Business Bureau.

And, If You Decide to Sign...

Get everything in writing, including business expenses from fees to equipment to supplies. Will the company refund any of your initial investment if you change your mind? Keep detailed records.

Some online opportunities are lucrative and legitimate, and – armed with a few online resources – it's never been easier to sort the good from the bad.

When it comes to working from home, "When there's a will, there's a way." Now it's up to you to find the way that best suits you and your lifestyle.

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