While I havent talked about it much on this blog, I’ve had a financial change of heart since I paid off my credit cards. When I was paying them off, I was totally against myself using them, and if anyone else cared what I thought, I was against them using credit cards as well. After I paid them off, I was strictly debit card for about a year – which was nice, because I couldnt spend what I didnt have, and I didnt have to keep a bunch of cards in my wallet. After managing my finances successfully for about a year, I started reading about miles and points, and how to use credit cards to help you collect lots of frequent flyer miles. If there’s one thing I like, it’s travel, and if there’s one thing I dont care for, it’s airplane ticket prices. I eased my way back into the credit card world, getting airline miles cards and making sure I could pay off the balance every month. After earning my first 75k miles, I was hooked. I moved on to more cards and more deals, racking up hundreds of thousands of points along the way (I even paid for our honeymoon tickets with points earned from credit cards). After a while of sound financial management, I began to see credit cards for what I think they are – a tool. Just like a rope, you can easily hang yourself with it, but it can help you climb walls too, if you use it right. When I was paying lots of interest money to credit cards, I saw them as a noose, but when I got into the “payoff your balance every month club” I saw them more as a tool. This has also been a way for me to even the score (In my mind anyway – I doubt they give a crap) – the more benefits that I can score while not paying interest, the more I can make back the interest that I paid them for 5 or so years. Best deal so far, a 1,300 dollar ticket for 15,000 points and 22 bucks in fees.
During my credit card change of heart though, one thing that I did like about the benefits of liability if there were unauthorized purchases on the account. With a credit card, the bank will pay the merchant and open an investigation, and with a debit card, the funds are already gone from your account, and you have to wait until the investigation is over until you get your money back. Unfortunately, this happened to me recently. Here’s what happened:
Yesterday afternoon, I got a text message from chase saying there was suspected fraud on my account. I thought the text was fake, but checked mint anyway and it didnt show anything pending, so I figured it was (they listed an amount of $150 even, which I thought was highly odd). I found it super odd, because I still had the card in my pocket, and had for quite some time. Later at night, I got a phone call from what was supposed to be chase, but they didnt leave a message – again, I thought it was fake, but I did make a note about their persistence and made a note to call them in the morning. So I gave them a call, and the rep did say that there had been some unauthorized purchases on the account and sent me to the fraud department. Apparently, someone in Jersey had decided to go on a little shopping spree on my dime – spending 300 at JC Penny, 150 at H&M and an unknown amount at Victorias Secret. Obviously, this person was high class (kidding….).
These were relatively easy for me to confirm, because H and I have been on a bit of a spending fast since we got back from our honeymoon – I had used the card a grand total of 2 times all of august (when normally, it’s my go-to). The last charges were in Bangkok, the next one was in Tokyo, and the final one was in Colorado. Other than that, I havent really spent much since we have been back. After confirming that those were the last of my charges, I asked the rep how this could have happened. She was not really interested in giving me a concrete answer because she didnt know, but she did tell me that a card was presented at all the locations, so she suspected someone got my information somehow, and then began using my card. She suspected that the number was copied somewhere such as a gas station (impossible) or something where they had loaded a number storing software on the machine. I guess it happens to everyone from time to time, and I’m just glad they were on top of it (though I probably would have figured it out within 48 hours).
One thing that I did want to point out though, is that if this was a debit card and not a credit card, they would have tied up my $700+ dollars for who knows how long. I only keep enough in my checking account every month to cover the automatic payments that come out of there, so this would have certainly caused an overdraft at some point, if they had not been able to return my funds promptly. However, with a credit card, it was the banks cash that was tied up (and they dont give 2 shits about 700 bucks), and I was not liable at all, and got to keep all my cash. This is probably one of my favorite benefits of credit cards, and shockingly enough, I “use” this benefit about once every other year. I’ve had fraud issues 3 times since 2007, and they have all been on credit cards – not risking my funds (writing that is making me wonder if I need to examine my own habits related to credit card usage)
Readers: Has someone ever gotten a hold of your credit card and used the number? Did they do anything interesting with it? Was it resolved easily?