Wednesday, March 07, 2012

A Few Steps Toward Safer Online Shopping

As toy collectors, many of us shop online regularly. For some items, that's the only chance we have to acquire them. Sure, you could hold off and hope to find something at a convention somewhere, but that often means never tracking down what you want or paying more than market value when you do. Besides, what's more convenient than a few clicks and delivery to your front door? So to the interweb we go. One of the unfortunate realities of online shopping is the risk of credit card fraud, and the collecting world has been reminded of that reality once again. There's no stopping it. The best locks can be picked, and the best virtual security can be breached. It happens every day to companies large and small. All we can do is protect ourselves as best we can while preparing for the possibility of our card numbers falling into the wrong hands. For anyone who may be interested, here are a few steps you can take to guard your finances as effectively as possible.
  • The first step you should take is to avoid shopping online with a debit card, or at least with a debit card connected to your bill money. Credit cards offer an extra buffer between your money and criminal activity, as you're not actually out anything while waiting on your bank to reverse fraudulent charges. If you cannot qualify for - or simply don't want - a credit card, you may wish to consider opening a second checking account for online purchases. You can move money into another account instantly via online banking with most institutions and keep your rent, mortgage, utility, or car payment cash separate from the secondary account. Even though your bank will return the money to your account, you don't want to be caught in the middle of that process when bills are due. You could also keep the bulk of your money in a savings account, but some of those have restrictions on the number of outgoing transfers in a given time period. Short of a credit card, two checking accounts might be the best option for many people.

  • Bank of America credit card holders can enjoy an additional layer of security for their cards by taking advantage of the company's ShopSafe feature. This allows you to generate a temporary card number with a spending limit and expiration date of your choosing. Your actual credit card number is never exposed to retailers or would-be bandits, thus protecting you from the hassle of even having to get a new card if data is compromised.

  • Prepaid cards are another option for people looking to take more precautions. These will certainly limit your exposure, but they're not terribly convenient for everyone. If none of the above options work for your situation, however, this could be a viable payment method that would allow you to feel more secure when shopping online.

  • Credit card numbers aren't the only potentially sensitive information stored in our online profiles. There's been some concern about user account passwords in recent discussion. Many would be surprised by the number of large companies that store customers' account passwords without any encryption. Passwords used for your checking accounts, credit cards, mortgages, auto loans, investment accounts, and PayPal should never be the same as the passwords you use for forums, e-tailers, social networking, or entertainment portals (Netflix, iTunes, etc.). There are laws that require financial institutions to protect online login information with certain safeguards, but those laws do not apply to other sites.

It's only a matter of time before another collector-driven business becomes the target of thieves. Credit card theft will strike those of us who enjoy this hobby once again, but we can learn from these incidents and take steps to minimize the impact it can have on our lives. Knowledge, preparation, and a bit of personal responsibility can go a long way. At the end of the day, using a credit card instead of a debit card means a bit of frustration, a phone call, and a short wait for a new card when it happens again. If you're looking for some extra peace of mind, though, hopefully some of the above suggestions will help you find it.

One final note: If you're going on vacation, don't forget to let your card issuer know about your travel plans. This is especially true for those of us who had to get new cards recently, as banks could place more scrutiny on our purchases. Many of us will be heading to New Orleans in June, and I speak from experience when I say it's no fun to have a card locked down while on the road. This simple step can save you a lot of aggravation.