How do you know when you're being legitimately charged money in the magical world?
Some traditions forbid charging for rituals, workings, training, or initiations. Some expect payment for any or all of the above.
Having a general knowledge of the religion/system is probably a good first line of defense. Payment is usually expected for hoodoo workings, from what I understand (which is admittedly little). A psychic, card reader, or palm reader is someone who, regardless of their belief system, will almost always expect to be paid. Voudoun and Santeria require the initiate-to-be to pay for their initiations.
Why is this? I think there are two reasons. The Dropout Dilettante has some good ideas; see her recent post, Etiquette Lesson: Magic Is Not For Free (Sometimes). She likens paying for magical services like spellwork to being no different than paying doctors, lawyers, or other service providers, and I generally agree with her.
Where I disagree is when she compares asking your friends who do magic to do so for free to bitching at your friend instead of seeing a shrink. Magic-using people tend to know one another, and I can't imagine friends not reading the cards or runes for me any more than I can imagine not whipping up a charm bag for them. Hell, I've done handfastings for free because the people involved were friends-who-are-family (and these were not "read-from-a-prewritten ceremony" handfastings, folks - these were customized within an inch of their lives). On the other hand, these people came to my house and checked some dodgy wiring, taught me to cook some vegan specialties, and did other things for me and mine. Maybe the difference is that I do these things for free for people with whom I have a give-and-take relationship in the first place.
I don't charge for my training circles; my tradition forbids me to do so. Even if it didn't, I'd still do it for free because I'm not professional clergy, and that's where the big difference lies for me. Traditions that charge for spellwork or initiations tend to be those where the clergy are professionals - this is what they do, 24/7, 365. If they didn't charge money, they wouldn't eat or have a home. Their communities are supporting them in the same way a Catholic priest or Unitarian minister is supported so that they can do the type of work that a clergyperson of this sort is expected to do.
Now, I did say "tend to" up there, and I know some of you are thinking, "Well, what about people who do spellwork for others, but still have a day job/trust fund/etc?" I'd take those on a case-by-case basis. Is someone charging an exorbitant fee? Do they have a sliding scale? Do their patrons need to come back frequently, spending even more money each time? Do other practitioners in the area seem to charge similar fees for similar services? Is this usual in their tradition, and do they even have one?
In magic, I think we should approach the question of money from the viewpoint of "buyer be aware."