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Mortgage Insurance? Not on Your Life!
Dear Mary: I just bought a house, and I've been getting a lot of flyers about mortgage protection insurance. Is it something good for a new homeowner or just a waste of money? — Donna, email
Dear Donna: Great questions. "Mortgage …Read more.
Tips That Make You Feel Like a Genius
Secretly, I feel like a genius when I discover a secondary use for this or that — in case I run out of this, but have plenty of that! Like using a paper coffee filter to wash a glass top or mirror when I'm in a pinch for paper towels. Or using …Read more.
Supermarket Tricks That Makes Us Spend More
I've always thought of myself as pretty sharp when it comes to spotting supermarket trickery. I'm not even fazed by an end-cap display announcing, "Special." I know their ways. They hope we'll just assume that "special" means …Read more.
The Struggle to Actually Use up Gift Cards
My love-hate relationship with gift cards has intensified. What a pain, really. I'm one who just forgets to use them, and when I remember, I try to figure out how to use each one to the last cent. I was reminded of my situation recently when I …Read more.
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Using a Debit Card Online Is Dangerous to Your WealthDear Mary: I saw in a recent article that you do not like debit cards, especially for online purchases. That makes me nervous. I have a debit card that can be used as a credit card. I use it online all the time. Is my card different from the kind of debit card you mean? Why do you not like debit cards? — Theresa B., e-mail Dear Theresa: There is no such thing as "a debit card that can be used as a credit card." Funds are withdrawn directly from your account with a debit card. When you use a credit card, you are creating a short-term debt. I'm sure that you, like millions of others, assume that your debit card is also a credit card because when you use your card in bricks-and-mortar stores, merchants ask you, "Debit or credit?" Merchants don't know what kind of card you have, so if they see a card with a MasterCard or Visa logo, they need to know whether you will be signing or using your PIN. When you use your debit card but say "credit" when the merchant asks, that means you opt for a signature-based transaction. The paperwork is processed through the merchant's bank with all of the credit transactions. It does not create a debt for you. You do not receive a statement at the end of a billing cycle asking you to make a payment to cover the purchase. The money comes directly from your account.
When you say "debit," you are asking for a PIN-based transaction. In this case, the funds are removed from your account immediately and put into the merchant's account. Theresa, your debit card is no different from other debit cards, and you are foolish to use it online. Anyone with your debit card number could empty your bank account in a New York minute. Online, a thief needs neither your signature nor a PIN to complete a transaction. Suddenly, the money is gone and your bank account is empty. That creates a horrible hassle, which includes filing a police report, dealing with your bank, proving that you are not the one who drained the account and then waiting to see whether you can get your money back. Some issuers are touting "hassle-free" restoration of funds, but that is a marketing campaign, not a requirement by law. Those promises can disappear anytime. Credit cards are regulated by different federal laws, which make card issuers responsible when cards or card numbers are stolen. Do you have a question for Mary? E-mail her at mary@everydaycheapskate.com, or write to Everyday Cheapskate, P.O. Box 2135, Paramount, CA 90723. Mary Hunt is the founder of www.DebtProofLiving.com and author of 18 books, including "Can I Pay My Credit Card Bill With a Credit Card?" To find out more about Mary and read her past columns, please visit the Creators Syndicate Web page at www.creators.com. COPYRIGHT 2009 CREATORS.COM
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