A Step-by-Step Guide to creating your avator on here
This site lets you shrink pics to the allowed size on here
http://www.shrinkpictures.com/There is a "How To" Video on here

Scroll down to this part of the main page
Click on the Brouse button & find the pic you want tto shrink
Click on the Custom Bubble and change it to 100 and also select the Best quality
Click on the RESIZE Button

Once it's resized your pic, it'll tell you to save it, Right Click on the pic and go to Save As and name it & put it in a folder

Log in to or create a new account on PHOTOBUCKET
http://www.photobucket.comCreate a new album if you want (don't need to though)
Click on the Upload Pictures button

When the pic has been uploaded, scroll down the page, either give the pic a new name or click on the box to use the original name and click on "Save and Continue to my album"

When the picture has been saved on there, the next screen will be this one

Hover over the picture to bring up the list of options and click inside the IMG Code box, it'll say Saved in there when you do that.
Log into the forum
Click on PROFILE at the top of the screen

When you're in your Profile page, click on Forum Profile Inforation

Click on the bubble where it says "I have my own pic, delete the http:// out of the box

And Paste the link to your pic that you've just copied in it's place

Scroll down to the bottom of that page and click on the Change Profile button

That should do it but I didn't see the new avatar that I saved on here so it might take a few attempts - I can't remember how I did it for my original pic.
There might be something I'm missing at the very end, maybe someone else can clarify that for us.
EDIT - Correction.
When you paste the link into the box on here, take the [ I M G ] bit off the beginning & end of it and then hit the Change Profile button