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2014 Payment Guide to Holiday Shopping (and Traveling)

by Jack Hojnar

Ok, I give up.

Try as I do to hold onto some semblance of the Holiday Shopping Season of my childhood, the abundant aroma of pine scented candles, the invasion of aisle space with fake gift-wrapped presents and the incessant droning of Mannheim Steamroller’s “Carol of the Bells" in every shopping mall the day after Halloween has me convinced that I need to let go of yesterday. Old School and Old Fashioned can quickly become Out of Touch.

But rather than be a Scrooge this Season, I present to you - gift wrapped far in advance of the trimming of the tree - the Annual Payment Guide to Holiday Shopping (you can thank me by sending cookies and milk my way).

No doubt, the improved economic forecasts have every consultant, prognosticator and reporter anticipating record retail activity this year. Moreover, online shopping will continue to explode over previous years if you believe a recent Accenture survey stating that 51% of consumers polled plan to spend 50% or more of their holiday buying dollars online.

Now let’s add another wrinkle: mobile payments.

Unless you live under a rock in the North Pole, you are aware of the impact of ApplePay and all that it intends to provide this shopping season, at least as far as potential security and convenience are concerned.

So if more consumers than ever before intend to buy online, and if ApplePay (or other mobile wallet options) become commonplace, that means one thing: credit card usage will increase.

NOTE: Exceptions exist. PayPal and other transaction account providers can link to checking accounts and other non-credit card payment methods. I get it. But this is an article about credit card usage and tips during the holidays. Meet me at the holiday cocktail hour later to resolve the dispute.


SOME BACKGROUND: New to the 2014 Guide
Past articles (2012, 2013) focused on using your credit card wisely for shopping purposes. This year I include credit card travel tips since travel is such a big part of the Holiday Season and most people pay for trips using their credit cards. Also, I include some conversations about mobile payments, though likely nothing too rattling to shake the snow off the roof.

So grab a glass of Nog, cozy up by the fireplace, go Old School vinyl with Vince Guaraldi’s Christmas album (known better as the music from A Charlie Brown’s Christmas, ranked #4 in “The 25 Greatest Christmas Albums of All Time”) and read this article to prepare to shop smarter this Holiday Shopping Season.


SHOPPING TIPS 101
Selecting the Card
Every credit card is different and I have no intention of telling you which card you should choose. If rewards are your thing, look for the card that provides the best rewards possible (Wallaby has some great information in this regard). If you desire a co-brand card to support your favorite charity, several options exist. Google searches go a long way.

However, if you intend to use your credit card to buy online or in the stores themselves, be sure to learn about the benefits associated with your card.

Understanding Card Benefits
Nearly every credit card provides no cost (or low cost) benefits to cardholders. During the shopping season, these benefits can enhance your shopping experience from Price Matching to Return Protection. Yes, even some PayPal accounts provide the same types of benefits found with bank credit cards.

Some great shopping Benefits* are:

  • Purchase Security: buy something with your card and it is protected from damage, loss or even theft for up to 120 days from your date of purchase.
  • Extended Warranty: buy something and double the manufacturer’s warranty up to one year or more, just by using your card.
  • Price Protection: buy something and find a better price later, you’ll be refunded the difference.
  • Return Protection: buy something you don’t like and the retailer won’t accept the return, get reimbursed; product return to administrator likely required.

*Terms and Conditions Apply

Now these descriptions above are brief to a fault. Every bank that issues credit cards provides variations of these types of benefits, from the products that are covered to the value of the coverage to the hours available for obtaining service. So, the moral of this Holiday Benefits story is simple: call your bank soon and ask what benefits you have available on you card.

Most often, your bank will also have benefit information on its website. And certainly, if you receive your statement by mail, card terms and conditions are typically within your statements. Best bet? Call your credit card issuing bank BEFORE you begin your Holiday Shopping, get informed and shop smart.

How Benefits Work
Credit Card benefits are simply designed to support and protect your shopping experience. So this means  you must read your program materials carefully. "Terms and Conditions Apply" may be a cute catch-phrase we’ve all heard before, but ... Terms and Conditions really do apply.

Know your benefits and the process before filing a claim. From my experience, one of the most frequent complaints to Claims Call Centers is angry people upset because of specific items not covered for certain damages, though all of this information is CLEARLY STATED IN THE TERMS AND CONDITIONS with your card benefits.

If you are able to file a claim, then you will ease your process considerably if you produce your receipt and/or your monthly billing statement.

SHOPPING SECURE AND SMART
During the past few years of producing this Holiday Shopping piece, I like what I’ve written so I’m stealing it and using it - verbatim - once again (Is it plagiarism if you steal your own work? Santa, please don’t judge.)

  • Printed vs. emailed receipts: This is your call completely. With retailers seemingly getting hacked everyday (just this past April, hackers nabbed 53 million Home Depot email addresses), you may want to ask for the traditional receipt. Some advice on saving receipts: Perhaps an envelope at home in your underwear drawer labeled HOLIDAY RECEIPTS would work. Why the underwear drawer? Most people wear underwear every day and if you forget where you put the envelope labeled, HOLIDAY RECEIPTS, chances are you will find it quickly in the one drawer that enjoys your company the most.
  • Read your bank statements (online and paper): Yes, it’s as much fun as shoveling snow in the winter, but checking your statements is important. Be sure to verify that purchases made appear, as they should on your bill. While most financial institutions catch fraud as it’s happening, such skills don’t guarantee 100% success. Do your work.
  • Do not sign the back of your cards with your signature: Instead print, “Ask for ID.” With most purchases, cashiers will simply turn over the card to check that a signature exists. “Ask for ID” forces the cashier to compare the name on your card to the name on your id.
  • Use one card for online purchases: If you carry multiple credit cards, designate one for all online purchase (if you shop online). This way, you can more easily track potential fraud and eliminate the hassle, should you experience fraud, of having your multi-purpose card suspended as you wait for the replacement.
  • Use trusted sites: During the Holiday shopping season, you may find yourself motivated by a company with a fantastic bargain on a hard-to-find product you really want. Don’t be fooled by unsecured sites or too-good-to-be-true offers. Be alert and aware.

TRAVELING SECURE AND SMART
As with benefits designed to support your shopping experiences, most credit cards include benefits that cover your travel, whether by plane, train, automobile or some other mechanism (Reindeer flights excluded …). Given the expected increase in travel this year as predicted by the American Automobile Association (AAA), understanding your travel-related benefits is a must.

Travel Emergency Assistance Services (TEAS) is a common benefit that can be helpful in most travel emergency situations. From Lost Luggage Assistance Services to Emergency Transportation Assistance to Pre-Trip Assistance, the TEAS benefit will put you in touch with the appropriate emergency services, including medical, legal, or transportation, should the need arise.

Be sure to contact your credit card issuing bank to determine the specific travel benefits associated with your card to make your travel experience secure and smart.

USING MOBILE /ONLINE PAYMENT ALTERNATIVES, LIKE APPLEPAY
ApplePay is not the first mobile payment or online payment solution to hit the marketplace. Google, PayPal and other companies are hanging out in this space as well. So regardless of the system you use, the rules are fairly similar to those you should follow with using your cards the traditional “swipe” way. Your benefits should work regardless of the payment method you select. Saving your receipts is critical to ensure smoother claims processing should you need to do so.

However, more banks seem to be promoting the use of ApplePay and, therefore, providing incentive to use ApplePay for online and in-store purchases. Be sure to check with your bank to determine what benefits are associated with these incentives.  Using ApplePay or some other promoted mobile solution that encourages card usage without benefits may not be the best idea.

AND BEFORE WE SAY GOODNIGHT …
Remember, the entire purpose of this article is to make sure you are aware of the benefits associated with your card. Whether you use a cash-back reward card or mileage-earning card or favorite charity contribution card, benefits come in handy. Like snowflakes, it’s in the benefit details that make card unique. Know your card before you shop.