Ask Officer Helbig: Credit Card safety is important to everyone
May 17, 2010
Filed under Blog, Opinions
Credit cards can be a blessing in many ways. You can track money with them so you know where it goes, you can make purchases of opportunity or necessity when you don’t have cash on you, you can avoid carrying around large sums of cash, you can rent a car or get a hotel room using the card, and credit cards allow you to make purchases to establish a credit history.
IF you have a GOOD credit history, this helps you to borrow money to make large purchases in the future like cars and houses.
If you make purchases online, credit card purchases have federal laws that offer some consumer protection where cash purchases do not. Credit card companies also offer customers varying types of protection against theft or fraud provided you report the problem promptly.
If you have a debit card, it usually does not offer the same level of safeguards that a credit card does. I have a debit/credit card that I can use either way. Whenever I am making purchases online or at a local business, I use the credit option rather than debit when possible for security reasons.
Enter your credit card for purchasing only on secure Web sites. Sites that start with “https” are normally better for security than those that start with “http”.
Shop with established companies and check out refund policies before purchasing rather then assuming there is always a return policy. For online auctions, you should consider a third-party online escrow service. These services will hold your payment until you receive the item and are satisfied with the merchandise.
Using a credit card with a small credit limit also is not as tempting to thieves as a card with a large limit.
Remember that credit card companies are in business to make money, not to protect you.
Every year that college starts, the campuses are lined with tables sponsored by credit card companies that will offer students a fancy pen, a water bottle or a tee shirt to sign up for their credit card. Check the credit rate and other information before signing up. Many college students get into serious financial problems by mismanaging credit cards for the first time.
Think about this: Making a $60 monthly payment on a credit card with a 19.8% interest rate and a $3,000 balance will take nine years to pay off and will cost you more than $6,000. Add this to loans for college and you might end up being afraid to graduate.
Keep a low balance on your cards, spend wisely, pay on time, check out the rates and services of credit cards that you are considering and ask your parents for advice and guidance.
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