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Protect your identity like it’s your home

Protect your identity like it’s your home

    “…Most people have a good idea of how to protect their houses from burglars, but few know the best ways to protect their identity and prevent identity theft.” Money for the Rest of Us has a fantastic article that draws parallels between protecting your identity from identity thieves and protecting your home from robbers.

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    Don’t open your door for just anyone. You wouldn’t let just anyone into your home, so don’t let just anyone have access to your personal records. Check with your employers, school, and financial institutions to see what documents they put your personal information on. Some schools still use Social Security numbers as the student ID number. And many employers put your entire social security number on your pay-stub. Ask to see what alternatives are available.

    Change your locks. If you suspect someone has a key to your home or if you’ve moved recently you would change your locks. The same goes for passwords. If you suspect something, change your passwords immediately. Moreover, change your passwords every 4-6 months. (Think about it, if you could change the locks to your house for free you might do this more frequently, too).

    Don’t hang $100 bills or fancy jewelry in front of the window. That’s right- you wouldn’t hang all your valuables in front of the window so thieves know exactly what you have and where they can find it- would you? I think not. Throwing your important documents into the weekly trash is just like hanging cash in the window. Identity thieves know exactly where where to find all of the information they need – in your trash. So, shred any paper with you personal information on it– name, telephone number, address, bank’s name, account numbers, SS#, etc. Remember, even junk mail needs to be shredded since it often contains credit card applications that can easily be filled out in your name.

    10 Ways Protecting Your Identity is Like Protecting Your House – [Money for the Rest of Us]

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    Last Updated on March 4, 2019

    How to Use Credit Cards While Staying Out of Debt

    How to Use Credit Cards While Staying Out of Debt

    Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

    I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

    Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

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    Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

    Do Not Treat Credit Cards as Your Funding Sources

    Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

    I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

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    I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

    If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

    Make Sure to Always Pay Off Balances in Full Each Month

    The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

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    Using Credit Cards with Rewards

    Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

    You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

    I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

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    So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

    What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

    Featured photo credit: Artem Bali via unsplash.com

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