Q: I am
interested in starting a home-based data entry/clerical business. I have been looking on the Internet,
sending out e-mails, etc. to no avail. I have found many scam
artists out there who promise big bucks and exactly what I'm looking
for, but they all want an amount of money first, then they send you
a booklet with company names and addresses. All I want to do is stay
home for my children and help to pay bills and the mortgage. Would you have an answer for me?
A: Unfortunately, although there
seem to be many work-at-home opportunities advertised in newspapers
and magazines, few of them are legitimate. And virtually none of
them are actually businesses.
You may see ads that say
things like “Earn one thousand dollars a week at home, in your
leisure time!” Or “Many people are supplementing their income by
working at home. Let us tell you how.” An offer like this may sound
very attractive. But be cautious about work-at-home ads, especially
the ones promising large profits in a short
period of time. Home employment schemes are one of the oldest kinds
of classified advertising fraud, according to the U.S. Bureau of
Even if a company actually offers you work at
home, it will often be on a piece-work basis. Because you are, in
effect, employed, you cannot legitimately deduct the cost of a home
office or other expenses on your income tax return, like you could
if you had a real home business. But you still do not receive any of
the benefits that you might expect to receive as an employee, like a
pension plan, health insurance or unemployment insurance
coverage...or even a living wage.
What many of the
work-at-home ads do not say is that you may have to work many hours
without pay. There also may be hidden costs. Many work-at-home
schemes require you to spend your own money to place ads in
newspapers, make photocopies, or buy the envelopes, paper, stamps
and other supplies or equipment needed to do the job. The company
may even demand that you pay a membership fee or make regular
payments in order to get continued instructions or materials. Or the
amount of money paid per item manufactured or envelope stuffed may
be so small that you end up making a very small amount of money per
hour. Some people who have answered such ads
have even found that they were victims of an outright scam; they
sent money and received nothing at all in return.
Clearly, it's prudent to investigate these
programs before becoming involved. If a work-at-home program is
legitimate, its sponsor will readily tell you - in writing and for
free - what’s involved.
You’re better off to take a course that will help you start up a
legitimate home-based business, offering your services to other businesses for
a fair market price.