smart spending

Don't get hooked by these 9 scams

6. Insider information

If you believe in the tooth fairy, you'll love that "misdirected" e-mail or instant message with unsolicited insider information on a company that's about to take off.

"The only sure policy is to assume that anything that comes via postal mail or e-mail is a scam and to seek independent verification," Fearnley says. These messages have two things in common: There was no accident involved in sending them and their intent is to get you to buy the company's stock.

Hit the delete key.

7. Sharing the wealth

From penny-ante soliciting -- think those cans at the cash register -- to boiler-room operations that rake in millions, raising money for charity can be extremely profitable. At least for those doing the fundraising.

For example, have you ever been pressured to buy a photo package from your local volunteer-rescue or -fire department? Chances are, there's a professional fundraiser behind it. The ploy: A fundraiser sells a one-time portrait door to door. The portrait is usually very reasonably priced and the selling tactics are pretty high-pressure. When you show up to pick up your photo, you are pressured into buying a big, expensive package. While it's perfectly legal, you might be dismayed to know how little the charity receives. Unless you really want the photos, ask what percentage the organization gets. In many cases, it's pennies on the dollar.

Some charities exist only as fronts for fundraisers, spending next to nothing on charitable works. Speyer says you should check on the charity's cut by asking to see it in writing.

Experts say you should never do business over the telephone with someone you don't know unless it's a call you originated. If there's a pitch you can't resist, tell the caller to send you the information in the mail. Otherwise, says Speyer, "hang up the phone."

And those donation cans sprinkled around town? Although some may be legitimate, many are not. Ask the proprietor what he or she knows about the charity before dropping in your spare change.

The best policy is to cut out the middle man and give money directly to charities you believe in, particularly local ones. For national charities, check the Better Business Bureau's charitable alliance at www.give.org.

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8. Home inspectors come calling

It's a scam the elderly often fall for: A "home inspector" is passing by and sees that your roof is leaking. He and his helper offer to take a quick look, and one of several possible scenarios unfolds -- while you're occupied with one, the other relieves you of your valuables, or a quick spray with a concealed water bottle makes for instant "water damage." In the second case, the hustler offers to fix your roof, nails on a few shingles, cashes your check and is gone before you realize you've been had.

Says Rob Paterkiewicz, executive director of the American Society of Home Inspectors, or ASHI, "Any individual who is going door to door professing to be a home inspector is not someone you should let in your house."

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