Thursday, July 19, 2012

Buying On Line

by Dick Evans

I remember way back when I first ventured into purchasing items online. I was apprehensive about giving out my credit card information over the net. Security back in the 90’s was pretty loose.

I began by opening a single credit card specifically for online orders. I purposely kept the credit limit low; around $500 I think. I figured if I had a problem with the account number being hijacked at least they could not get me for more than that! Good idea except my credit card company was so thrilled with my use of the card they upped my limit automatically. So much for that failsafe!

Well, security has gotten better and I am comfortable using my cards at known online retailers like Amazon and Staples and OfficeMax and Egghead... Whenever I can I like to use my PayPal account. It gives an added level of security as the place I am buying from never gets to see my credit card information. And I can use PayPal to receive funds from others.

One of my credit card companies offers a one time number. The call it a Secure Online Account Number:

I sign in to my account and request a number. It immediately creates one for me to use on my next transaction. It can only be used once and will post against my credit card. Works great. I use this for all purchases that cannot be done with PayPal where I do not have a relationship with the seller.

In addition to Discover, I understand other companies offer this service as well. Check with your credit card company and see what they offer.

One last comment regarding Debit Cards. I do not like to use them. They hit my checking account right away and offer no benefit to me at all. I would never use one for an online purchase.

The math is simple. I buy with a debit card and my checking account is hit right away. Not only do I have to have the cleared funds available but I have no recourse if I have an issue with what I purchased.

When I use a credit card, I have 30 or more days of the money being in my checking account. If my account pays interest, I am paid by the bank to leave it there. Add to that the 1% to 5% cash back rewards I get with my credit cards--they pay me to use their card. If I have an issue with something I ordered, they go to bat for me with the seller to resolve the issue. In the meantime the charge is taken off my account so I am not charged any interest.

Simply put, I use credit cards and PayPal to purchase online. If the seller is an established company, I trust them with my information. If not, I use a one time number for the purchase.