Gift Cards Stay Popular, but Some Recipients Get Only Headaches

The perils of gift cards is a story that we tend to do every single year, but it is still a good reminder of what you are dealing with. (Read our story from last year)

Today it's the Wall Street Journal's turn:

One of the most popular gifts in America still leaves a lot to be desired. The National Retail Federation expects shoppers to buy close to $25 billion in gift cards this holiday season, even though both state legislators and federal regulators have put the cards' fees and fine print under the microscope recently. In August, the federal Office of the Comptroller of the Currency told banks that they should disclose their terms and conditions in a way that both giver and getter could clearly understand. A handful of states, meanwhile, have passed laws creating their own gift-card rules.

Click here to see the warnings and what to do when buying one as a gift.

Can one phone call lower your credit card rate?

Today at 4:55 pm, Jeff Ehling showed us how one phone call could lower your credit card rate.  Now that's a story in time for the holidays if I've ever seen one.  (CLICK HERE TO READ THE FULL STORY)

More links
- Check your credit report for free
- To find current credit card deals

Best Blogs for the Young and Broke

BusinessWeek Online reports on a new trend...personal finance blogs.  No, not ones by some financial advisor who is trying to sell you something, but real honest to goodness people.  They write about their "PF" experiences so you can learn something:

Figuring out whether clipping coupons is worth the time and money saved at the grocery store may not be your cup of tea. According to many young personal finance (aka "PF") bloggers, the subject of money is still "taboo" and many of their friends don't know how to create a budget, set goals for retirement, or manage their debt. Says Amanda Gleason, 24, who pens the Young and Broke blog from Chicago: "So many of my peers and friends were uneducated about personal finance, from 401(k)s to saving for retirement."

See the list here.

Opting out of credit cards

Want to opt out of pre-screened credit cards? If you're like most people, chances are you can't open up your mailbox without finding at least a couple of credit card offers. You know...the kind that promise things like pre-approval and low interest rates. Some consider them a deal...but if you consider them "junk mail"...did you know that federal law gives you the right to opt out of unsolicited credit card applications??!! There's actually a toll free number and a website dedicated to allowing you to put an end to all the envelopes!

On the web:
https://www.optoutprescreen.com/

Or by phone:
1-888-5-OPT-OUT

Here is more from optousprescreen.com:

To Opt-Out of Direct Marketing Association (DMA) Lists
The Direct Marketing Association (DMA) tracks consumers who prefer not to receive mail or telephone solicitations. The DMA can provide information about opting out of lists produced by companies that subscribe to its Mail and Telephone Preference Services. You may contact the DMA at the following web address: http://www.dmaconsumers.org/consumerassistance.html.

To find out more about credit reports, your rights as a consumer, the Fair Credit Reporting Act and the FACT Act
Please visit www.ftc.gov/credit/.

To request a copy of your credit report from the Consumer Credit Reporting Companies
The federal Fair Credit Reporting Act (FCRA), as amended by the Fair and Accurate Credit Transactions Act, requires each of the nationwide Consumer Reporting Companies to provide you with a free copy of your credit report, at your request, once every 12 months. www. AnnualCreditReport.com is the only web source authorized by all three nationwide Consumer Credit Reporting Companies, Equifax, Experian and TransUnion, from which free annual credit file disclosures can be requested. Consumers are able to order their credit reports under the roll-out schedule established by federal law. For more information on this subject visit http://www.ftc.gov and click on the “for consumers” link.

You may also call toll free: 1–877–322–8228 to request your free annual credit file disclosure.
Hearing impaired consumers can access our TDD service at 1–877–730–4104.

To find out information on disputing or correcting information in your credit file
Please contact the Consumer Credit Reporting Company that provided the credit report

• Equifax - www.equifax.com
• Experian - www.experian.com
• Innovis – www.innovis.com
• TransUnion - www.transunion.com

To find out more about credit repair
Please visit the Federal Trade Commission Credit Repair information at http://www.ftc.gov/bcp/conline/pubs/credit/repair.htm

To find out more about identity theft
Please visit the Federal Trade Commission Identity Theft Center at http://www.consumer.gov/idtheft/

Credit or debit?

I have done many stories on the question - credit or debit?  Which card is best?  I don't think there really is one answer, it depends on you. ConsumerAffairs.com takes a look at the pros and cons of both. 

Security is always a hot topic when it comes to plastic:

Federal law mandates that credit card users are liable for no more than $50 worth of fraudulent charges on their accounts, and both MasterCard and Visa offer "zero liability" protection for any charges made with a person's card number or offline receipt transactions.

Interestingly, they don't offer zero liability for PIN-based transactions, which are the ones that earn them the least profit.

Debit cards enjoy similar protections for the most part, but only if customers report fraudulent charges within 48 hours. If you don't report fraud or theft of their card immediately, you can end up liable for virtually all of the charges made on the card, even if it was stolen or hacked.

Banks and credit unions have individual rules governing their fraud protection plans, so read the fine print in your user agreement.

If a company checks your credit report, does it ruin your credit score?

Elisabeth Leamy, the Savvy Consumer at abcnews.com, was asked a question a lot of consumer want to know about:

Question: I keep getting these "pre-approved" offers by mail from credit card companies. They have run my credit report, or so they say. When these companies do these small credit checks, does it affect my credit score? If so what can be done about them just randomly going in and doing a credit check? — S.C. Liberty, Mo.

Answer: This is a common misunderstanding. Don't worry. When companies run your report at random to see if they'd like to offer you credit, it does NOT hurt your credit score. Nor does it hurt to order your own credit report as often as you like. What DOES hurt your score is if you APPLY for lots of credit and therefore many companies check your report at your request. Bankers get suspicious if you apply for gobs of credit all at once and that lowers your score. Even though unsolicited credit checks do not harm you, if you do not want to receive endless credit card offers in the mail, tell the credit bureaus you want to opt out. You can do this by calling (888)567-8688. You can opt out for a few years or forever!

For more answers, click here.

Is 7-years-old too young?

Bankrate.com got a question I found a little surprising:

Q: My wife and I both have good credit scores (708 and 734) and are considering putting our 7-year-old son on a credit-card account as an authorized user so that he can start establishing his credit profile now. My question is, am I allowed to put him, at age 7, on the account as an authorized user? If not, how soon can I start establishing credit for him?

A: In general, minors aren't allowed to enter into contracts creating a financial obligation, but since, as an authorized user on your credit card, he doesn't have a financial obligation to repay the card balance, I don't see any reason why he can't be listed on your account as an authorized user.

When a married couple has one spouse on a credit-card account as an authorized user, the credit-card company must provide the account payment history on the authorized user's credit report. The card company is under no obligation to do so when the authorized user isn't a spouse, so you'd want to confirm that the card provider will provide that payment history for your son.

A good credit score provides the means to an end -- being able to borrow to finance assets at attractive interest rates. The pervasive use of personal credit histories to make inferences on employment, renting and insurance decisions makes managing your credit score an important aspect of financial management. But it's easy to get too wrapped up in managing your credit score.

Just because you can do it doesn't mean you should do it. Your son is over a decade away from being able to apply for credit on his own. There's no need to start building a history at age 7.

My counsel is for you to hold this idea in abeyance for the next six to eight years.

Out of thin air - your pin number?

Following up on a story we first brought you in early March concerning a security breach with ATM cards.  It looks like a possible leak has been discovered.  Tech columnist Bob Sullivan believes the breach could have been through the wireless world.  As retailers transmit payment information over the air, user PINs could have been transmitted too and intercepted by the wrong group.

Think Tearing Up Your Mail is Enough?

The Fight Identity Theft Blog found an interesting story about a man who received a credit car application in the mail.  He tore it up.  Then put it all back together with tape and mailed it in.  Guess what, he says he still got the card.

The moral of the story, maybe you want to shred all of those unwanted junk mail applications.

Check your credit card receipts

Texas Attorney General Greg Abbott has a warning about your credit card receipts and your safety:

Guard Against Credit Card Abuse: Check Your Receipts
By Greg Abbott
Attorney General of Texas

A credit card receipt with your full account number and expiration date on it can be just as dangerous to your financial security as losing your credit card. A stray receipt in the hands of a capable criminal could cost you money, not to mention countless hours and resources trying to clear your name.

In response to this threat, the Texas Legislature in 2003 enacted a safeguard to protect consumers against credit card abuse by requiring businesses to conceal all but the final four digits of the account number on all receipts for goods or services paid for with credit or debit cards.

The deadline for all Texas retailers to comply with the law, which also prohibits the printing of a card's expiration date on the receipt, was Dec. 31, 2005.

The law does make an exception for transactions in which the sole means of recording the credit card or debit card number is by handwriting or by an imprint or copy of the card. Merchants also are allowed to keep a copy of the receipt with the full credit card information in order to process your transaction.

However, business owners who continue to print the entire credit or debit account number on consumer receipts are breaking the law and may be penalized up to $500 for each month of noncompliance. My office and local prosecutors are responsible for enforcing this law.

If you notice that a receipt generated after Dec. 31, 2005, contains more than the last four digits of your credit or debit card number, you should file a consumer complaint with my office. Complaints can be filed on the Attorney General's website at or by calling (800) 252-8011

However, you must do more than securing your receipts in order to protect your identity. When using your credit or debit card, for example, keep visual contact with the card at all times to be sure no extra imprints are made. Also, do not allow a salesperson to write down your driver's license or Social Security number.

Beware of crooks who might tamper with your mail or trash. Destroy any unused credit card applications you may receive in the mail notifying you of "pre-approval."

You should also check catalogues and magazine subscriptions to be sure your card number is not on the cover or mail order form. If it is, contact the company and request it be removed.

Never give out your credit card number over the telephone unless you initiated the call and know the company is reputable. Legitimate companies and financial institutions never call you to ask for or to verify a credit card number.

Examine your bank and credit card statements carefully each month. If you suspect your account number has been compromised, immediately contact the credit or debit card company and cancel the card.

Early detection of fraud is extremely important. The Fair Credit Billing Act ensures that if you report the loss of a credit card before it is used, the card issuer cannot hold you responsible for improper charges. If your card is used before you report it missing, you will only be responsible for $50 of the unauthorized charges. You should also contact the three primary credit reporting agencies (Experian, Equifax and Trans Union) to have a security alert or freeze placed on your report.

It may also be a good idea to request a copy of your credit report from the Annual Credit Report Request Service and review it for unauthorized account activity. Report any unauthorized charges and accounts to the appropriate credit issuers.

Remember, the fraudulent use of credit cards is not limited to the loss or theft of actual credit cards. A scam artist only needs to know your credit card number to fraudulently make numerous charges against your account. Consumers and law enforcement must work together to fight credit card fraud.

Have you come across a restaurant that is not following this law? email us