Key Takeaways
- A recent report from the Federal Trade Commission found that 40% of all credit fraud happens in the 20-29 age group.
- Younger people tend to use their credit cards more online than other people as they shop online or sign up for automatic payments for online services they use.
- To protect yourself from credit card fraud, sign up for a credit monitoring service, and use a website to help you track your finances so you can check them at least once a week.
Have you ever seen one of those disturbing commercials where there’s a person, and they are speaking in someone else’s voice, having fun in Florida spending all kinds of money, just to find out at the end that it’s your money? They got a hold of your credit card through some kind of fraud scheme. And it seems like they tend to target these older couples.
However, the Federal Trade Commission recently did a report on credit cards that found that 40% of all credit card fraud happens in the 20-29 age group versus only 18% in the 70-80 age group. I really would have thought it had been the other way around.
While the report did not go in to why these numbers are this way, my guess is that younger folks are using credit cards a lot more online than older populations. They are probably also signed up for more automatic charges for online services they use, so there are more chances for fraud.
So how can you protect yourself from credit card fraud?
One of the best things to do is sign up for a paid credit monitoring service, that way if you have an issue with fraud, you will not only be notified, but you’ll also have a company that can help you deal with resolving the issues.
And before you go running to switch over to debit cards because you think a credit card is not safe, just remember, credit cards are generally covered by insurance in case there are fraudulent charges made. You can work with your bank to identify the false charges, and it’s typically easy to get them removed. If you use a debit card, it’s a straight link to your account, meaning money is actually taken out, and that can be very difficult to get back.
However, if you aren’t paying much attention to your credit card charges and you don’t catch the fraudulent charges early on, it can be difficult to resolve. This can cause credit problems on your FICO score, the score that says what your credit capability is. If your FICO score is dropping, you can end up with worse terms on interest rates for loans or credit cards.
A way to ensure you are staying on top of your credit card charges, is to be aware of what’s going on with your finances. There is a whole litany of websites out there, Mint.com being just one of them, that help you track your finances. You can use these programs to get a snapshot of your finances once a week. We call this Financial Fridays, but it’s just dedicating a few minutes a week to look through your charges chronologically to ensure nothing looks out of place. If something doesn’t look right, then you can call up your bank and get it taken care of. If you are checking once a week, then you can easily catch something if you see a charge you didn’t make, and it won’t affect your credit score in the long term.
So, use credit cards for the insurance, make sure you’ve got a credit monitoring service, and use a website to help you track and check your finances at least once a week.
Until next time, enjoy!
Gary