Think credit, not debit, when shopping online
Attention holiday shoppers. If you're ordering things on the web, by phone, or mail order -- do yourself a big favor -- use a credit card and not a debit card. While the banks insist debit cards are as safe as credit cards, consumer groups warn that's not the case.
"Debit cards are not as well protected for theft and loss under federal law as credit cards," says Beth Givens, founder of the Privacy Rights Clearinghouse, based in San Diego.
"We just don't recommend debit cards because of the potential of your having your checking account wiped out," Given says. "Yes, most banks guarantee that you'll get your money back, but what they don't tell you is the investigation could take days, weeks, even months. And we've heard of all of those scenarios."
And while that investigation is taking place you could have a lot of bounced checks, because you don't have any money in your checking account. "And of course, there are fees for all of those things as well, penalties that you would have to pay," Givens notes. "So it's really a bad news scenario."
By the way, Consumer Reports and Kiplinger's both recommend always using a credit card for all online purchases.
For More Information:
Online Shopping Tips: E-Commerce and You
Consumer Reports: The Dark Secrets of Debit
What to know about online shopping
"Debit cards are not as well protected for theft and loss under federal law as credit cards," says Beth Givens, founder of the Privacy Rights Clearinghouse, based in San Diego.
"We just don't recommend debit cards because of the potential of your having your checking account wiped out," Given says. "Yes, most banks guarantee that you'll get your money back, but what they don't tell you is the investigation could take days, weeks, even months. And we've heard of all of those scenarios."
And while that investigation is taking place you could have a lot of bounced checks, because you don't have any money in your checking account. "And of course, there are fees for all of those things as well, penalties that you would have to pay," Givens notes. "So it's really a bad news scenario."
By the way, Consumer Reports and Kiplinger's both recommend always using a credit card for all online purchases.
For More Information:
Online Shopping Tips: E-Commerce and You
Consumer Reports: The Dark Secrets of Debit
What to know about online shopping