So you’re at the mall or sitting in front of your computer racking up on holiday gifts and all the while you’re concerned that using your credit card was a bad idea.
Stop listening to the haters!
Using a credit card for your holiday shopping is not only the safest option, especially when shopping online, but it can also save you money. Here’s how…
Most credit cards offer something called “Price Protection” or “Price Matching.”
Price matching is a free benefit whereby if you buy something with your credit card today, and then find the same exact item cheaper over the next few months, you can actually ask your credit card issuer to credit your account the difference.
How many of you shopped on Black Friday thinking you were going to get the best deals by standing in line at 5am?
Well, I’m sorry to tell you that you were wrong. Retailers often continue lowering their prices all the way until after Christmas.
That means if you bought something the day after Thanksgiving, and then found it cheaper the day after Christmas, you should file a claim with your credit card issuer and leverage your price protection benefit.
Most Visa, MasterCard, Discover and American Express cards offer this little-known card benefit.
Price protection terms vary by card issuer and there’s a limit on how much you can recoup per item and there’s a cap on how much you can recoup per year.
Let’s face it, credit card fraud happens and nobody is immune.
The last thing you want to deal with over the holidays is trying to find out how your credit card number was compromised.
Thankfully a Federal statute called the Fair Credit Billing Act, or “FCBA” protects you, financially.
The FCBA is the law that limits your liability on fraudulent credit card user to no more than $50. And, as a matter of customer service most credit card issuers won’t even ask you to absorb the $50.
Most will simply deactivate your existing card, send you a new one, and ask you to fill out a form identifying the fraudulent activity.
Debit card users are also protected from fraudulent use of their debit card by the Electronic Funds Transfer Act but the limit is up to $500.
The difference, in my mind anyway, is that with a credit card it’s the bank’s money and with a debit card it’s your money. I’d rather the fraudster steal the banks money than my money.
Extending Factory Warranties
How many of you will buy (or have already bought) expensive electronics for gifts? Did you buy the extended warranty at the register when you were checking out?
If you did, then you wasted your money because most credit cards will extend the factory warranty as a free benefit of making the purchase with your card.
All of the credit card networks (Visa, MasterCard, Discover, Amex) offer free warranty extensions but there are some terms with which to become familiar.
First off, most of the networks will double your factory warranty, which is simply fantastic. There is, however, a cap of ~12 months on the extension.
The maximum benefit, which you’ll never reach, is between $10,000 and $50,000 per year.
As with all credit card benefits, there are some exclusions. Normal wear and tear isn’t covered and neither are natural disasters.
Still, unless your new phone gets swept away by a flood you’ll likely enjoy 12 more months on your phone’s factory warranty, for free.
John Ulzheimer is the Credit Expert at CreditSesame.com, and a credit blogger at SmartCredit.com, Mint.com, and the National Foundation for Credit Counseling. He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry. The opinions expressed in his articles are his and not of Mint.com or Intuit. You can follow John on Twitter here.