Is It Worthwhile To Still Use Credit Cards with So Many Data Breaches?

Just recently, PF Chang’s acknowledged that 33 of their restaurants had suffered a security breach over the last 8 months and that the credit card numbers as well as possibly the customers’ names and the expiration dates of the cards were compromised.  This news should be shocking or surprising.  Unfortunately, data breaches have become common place.  Just consider the recent security breaches at Target, Michael’s, and Neiman Marcus, to name a few.

If you’re diligent about shredding your personal information so that it can’t get into the wrong hands, you’re still not safe.  Consider all the recent security breaches.  It’s enough to make people start to think about not using credit cards just  to avoid this problem.

But even that is not a complete solution.  Yahoo! Finance just announced that a Russian gang has stolen billions of Internet passwords and millions of e-mail addresses.  “The records include confidential material gathered from 420,000 websites, ranging from household names to small Internet sites” (Yahoo! Finance).

The problem is so widespread.  If you want to live in the modern world, going without the Internet and credit cards to preserve your identity is very difficult.  Instead, consumers need to become even more diligent in their efforts to protect themselves and their identities.

Data Breaches Consider taking these steps:

1.  Change passwords frequently and make them difficult.

If you’re using “Sunshine” or “password123″ as your password, it’s time to step things up.  Choose passwords that have capital and lower case letters as well as symbols and numbers.  A password like “S&36ptrM$9″ will be much more difficult to crack than the passwords most people use.

Remember to also change your passwords frequently and avoid using the same password for all of your accounts.

2.  Protect your data.

When you shop online, you have the option to have the company save your credit information.  Do not opt to do this to protect yourself and your financial information.  Yes, entering your credit information every time you place an order online is a pain, but it’s much easier than trying to resolve identity theft.

3.  Order your credit report 3x year for free.

Each of us is entitled to one free credit report per year from each of the credit bureaus.  Make sure to order yours, but rather than ordering all three at once, stagger them.  Order one from Experian in January, one from Equifax in May, and one from TransUnion in September.  By staggering them, you can keep a close eye on your credit and notice fairly early if there is any unusual activity.

4.  Check your accounts regularly.

Especially if you have automatic payments set up, make sure to still take the time to look at your account to make sure there is no suspicious activity.

5.  Consider freezing your credit.

This is a radical step, but freezing your credit is the best way to protect your identity.  If your credit is frozen, no one can open a new account (including you) unless the credit is thawed using a special code you’re given when you freeze your credit.

Identity theft is an unfortunate consequence of our modern world.  You can’t avoid all technology to protect your financial information.  These strategies will help protect you while letting you use and enjoy modern financial conveniences like credit cards and ordering online.

The 1,700 Mile Move: 5 Lessons I Learned

I come from a family of non-movers. For example, my mom, once she married, became listless and lost her appetite and quite a bit of weight.  The doctor diagnosed her with homesickness.  She had moved less than five miles from her family home to her home with my dad.  (Yes, this is a true story!)

We moved one other time less than a 1/2 mile away, and even that was traumatic for her.

I have ventured farther in my lifetime, going 400 miles away to graduate school, but a 1,700 mile move is something else entirely.

Here’s what I’ve learned so far as we prepare to move from the Midwest to the Desert Southwest:

1700 mile move1.  We had way more “stuff” than I thought.  I knew we had a lot,
but wow, I didn’t know how much.  We’ve sold, thrown away, or donated at least half of our stuff.  Every time we think we’re almost done packing, more “stuff” seems to appear.  I wonder if we’ll ever be done!

2.  Plan for a long-distance move as early as possible.  We started selling our stuff back in early May, and so far, that stuff has brought in over $1,000.  However, even though I started selling items 8 weeks in advance of our move, it still wasn’t early enough.  We’re less than 5 days away from our move, and I am still waiting for our treadmill, file cabinet, and office desk to sell.

I was surprised to see that sometimes listing things to sell on eBay, Facebook, and Craigslist is like planting seeds.  I’ve listed some things, and there was no interest.  But then, say two or three weeks after I listed them, someone discovers the listing and buys the item.  Allowing enough time for things to sell is essential.

3.  Exercise equipment has no resale value.  Many people want to buy exercise equipment, but selling that equipment later is difficult.  Luckily, I bought our treadmill second hand for less than $100 a few years ago.  I don’t think it’s going to sell before we leave.  I think I’ll be taking it out for trash pick up.

4.  Moving 1,700 miles is expensive!  Luckily, my husband’s employer is paying for our move.  Still, even though we’ve seriously pared down our belongings, the move is going to cost over $6,000!  (We’ve paired down so much that the mover estimated two other families’ household goods could fit on the semi-truck with our small load.)

If my husband’s new employer wasn’t paying, I think the smartest financial decision would be to sell everything before we move and buy used once we’re in our new location.

5.  Determining the cost of living in a new location isn’t easy.  Since Tucson, Arizona (where we’re going) has a lower cost of living than Chicago, Illinois (where we’re leaving) and my husband received a substantial raise with his new employer, we thought we’d be in a better position financially.  That’s before we looked at the new company’s health insurance plan and saw how much worse it is than our current plan.  Most of my husband’s raise is going to cover the difference in the cost of insurance.

Have you moved a thousand or more miles away?  If so, what lessons did you learn?

Why Purchasing Rental Car Insurance Isn’t Necessarily a Waste of Money

I recounted in my last post the many adventures we had driving 1,750 miles from Illinois to Arizona where we damaged not one, but two rental cars.  We saved $100 by not purchasing the rental car company’s auto insurance, but that decision cost us $500 in our deductible.  Not my brightest move ever.

If you think, like I did, that a rental car company’s insurance is a scam that should be avoided like the plague, here are some reasons why you might want to reconsider:

The Rental Car Company Has a Different Standard Than You

Rental Car InsuranceThe rental car company we used said any damage smaller than the size of a quarter, they would let slide.  Anything bigger than that, and it needed to be repaired.

Any time you drive a car, you risk bumps and scratches to the car’s exterior.  I have a large scratch on the back of my vehicle that I find annoying, but not worth the price of paying my $500 deductible.  I’m guessing your own vehicle has similar scratches and dents.  They’re minor, and you don’t want to spend the money to repair them.

The choice is yours because it’s your vehicle.  However, if it’s bigger than a quarter, the rental car company is going to make the repair, and you will pay if you don’t take out the rental car company’s insurance.

Your Insurance Premium May Go Up

Another reason people let minor dents and scratches on their own vehicles slide is because they don’t want to face a claim and risk having their insurance go up.

Some people even do this for more major repairs.  Several years ago, a man rear-ended me, and he chose to pay the $1,400 for the repair to me directly so he could avoid submitting the claim to his insurance and risk having his premium go up.

If you don’t purchase the rental car company’s auto insurance, you’ll have to choose to pay out of pocket or to risk having your premium go up.

How to Decide If You Should Purchase Insurance from the Rental Car Company

To decide whether or not purchasing insurance from the rental car company is worthwhile, ask yourself these questions:

1.  Have you made any claims on your insurance in the last three to five years?  If so, you will probably want to purchase the rental insurance; in the long run, that will be cheaper than facing a spike in your insurance.

2.  How far do you have to drive?  Of course, accidents can happen anywhere, but if you’re renting a car for the weekend and driving it around your hometown, you may be able to avoid rental insurance.  Our problem was that we were driving 3,500 miles round trip in an area we were unfamiliar with.  Things like dead deer and street sweepers on the highway pose risks that you can’t foresee before the trip

3.  How high is your deductible?  If your deductible is anywhere from $500 to $1,000, purchasing rental insurance may be smarter, especially if it is going to be less than $100.

What is your opinion?  Purchase car rental auto insurance or just rely on your own car insurance?

Original img credit: Insurance Disclaimer on Flickr