The holiday season is an enormous economic event, so much so that the National Retail Federation estimates that holiday shopping represents as much as 30-40% of a retailer’s annual sales. But as a consumer, increased spending can leave you more vulnerable to theft and fraud.
However, there are steps you can take to guard against theft. Here are seven ways to protect yourself as you shop for the holidays.
1. Pay with a Credit Card
Stolen cash isn’t easily recovered, and a thief could use your debit card to empty your bank account. Credit cards offer better protection.
Even if your card is stolen, federal law dictates that you can’t be held liable for more than $50 in charges. That liability drops to $0 if you report the card’s loss before fraudulent charges occur or if it’s your card number, not your physical card, that was stolen. Many credit card issuers will automatically waive the $50 no matter the scenario.
2. Use a Virtual Card Number Online
Some credit card companies offer virtual card numbers, which can keep your information safe as you shop online. These temporary 16-digit numbers are linked to your account, but allow you to set predetermined spending limits and an expiration date. If a thief gets a hold of your virtual number, your exposure is limited and you won’t have to go through the hassle of canceling and replacing your card.
There are third-party virtual card providers out there if your credit card company doesn’t offer this service, but their quality may vary and they will require you to sign up for a separate service.
3. Protect Your Account Logins
Your accounts are only as strong as your password. Use different passwords for every account; this way, if one of your passwords is compromised, your other accounts will still be safe. Many online retailers (including Amazon) now offer two-factor authentication, which gives you an additional layer of security when you login.
4. Shop with One Account
It’s more difficult to track your spending when you use multiple credit cards or bank accounts. You should limit your holiday shopping to one account, which makes it easier for you to identify unauthorized charges.
5. Shop at Secure Websites
Be careful about the websites you visit. You should only make purchases at trustworthy retailers. Also, check for the secure padlock icon and an “https” at the beginning of the retailer’s web address, both of which indicate that the site is encrypted. This makes it more difficult for hackers to steal your information.
6. Monitor Your Accounts
You should be closely monitoring charges on your account all year long. While many financial institutions now offer account monitoring, their systems aren’t foolproof. Make sure to carefully read over your monthly statements to identify unauthorized charges.
7. Monitor Your Credit Report
Credit card numbers are replaceable, but if thieves get hold of really important information—like Social Security numbers, birth dates, and addresses—you could become a victim of identity theft. Check your credit report regularly to make sure no one is opening fraudulent accounts in your name.
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