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There’s nothing wrong with shopping online — it’s fast, easy and convenient — but it’s also important to make sure you know and trust the online companies you’re frequenting.
We recently received this question from a reader on how to cyber-shop safely:
“I use my credit card to make purchases online and usually receive these purchases through email. Is this safe? If not, what should I do? Should I cancel my credit card ASAP?”
Before you panic and cancel your credit card, it may help to know that there are laws in place that protect you from fraudulent purchases or credit card theft. In fact, using a credit card for online purchases is the smartest way to go when shopping online. Thanks to the Fair Credit Billing Act, your liability for unauthorized credit card charges is limited to no more than $50, as long as you report the charge within 60 days of the incident. Even then, most credit card issuers offer zero liability protections that would waive the $50 fee in credit card fraud/theft cases.
Debit cards, on the other hand, are tied directly to your bank account and even if you report the theft immediately, you may have to wait several days to get your money back. If you report the theft within two business days of the transaction, your liability is limited to $50 but if you wait any longer, your liability jumps to $500. Wait longer than 60 days and you’re liable for the full amount. When shopping online, always choose credit over debit just to be safe.
If you’re worried about shopping online, here are more tips on how to shop safely:
And if you want to take it a step further, you can always use a temporary credit card number.
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