Why I Disagree with the Money Experts About Internet Transactions

 

Locking mailboxes come in many styles at many prices

Typical locking mailbox. Photo: Signature Hardware.

I came across an article in a recent AARP Magazine in which finance reporter Jean Chatzky quotes Neal O’Farrell of the Identity Theft Council. O’Farrell urges consumers to ditch snail mail when it comes to paying bills and doing banking.  

Chatzky says he “calls the U.S. postal system ‘an absolute gift’ for identity thieves, who can reach into your mailbox and grab whatever’s there.”

I stand 180 degrees on the other side of this. Facebook, UCLA, Target Stores, and even the Pentagon have been hacked. I assume that neither Ms. Chatzky nor Mr. O’Farrell are familiar with locking mailboxes. We have one at our home and it’s a piece of cake.

I do not store my personal information, such as date of birth, social security number and the like on the Internet. It’s high-tech Russian roulette.

And there is one big bonus to receiving paper records: You end up with hard copies that cannot be lost or altered by an electronic glitch or a ham-handed clerk. I like being able to whip out paper copies of my accounts any time I need them.

 

The IRS is trying to give away more than $150 million

What? The Internal Revenue Service wants to give away money? Well, sort of. For tax year 2010, about 100,000

Dollar bills

Photo: 401kcalculator.org

taxpayers screwed up the mailing addresses on their tax returns. As of last summer, the Treasury Department had about $153 million lying about that should be refunded. That adds up to about $1,530 per return.You can check out whether you are entitled to a refund at www.irs.gov or call 800 829-1954.Good luck. And let us know if you are a “winner.”***********************The Consumer Gal and I just had our book, Enough of Us – which deals with other subject matter – published. Now we have to focus on marketing our “baby.” So for thetime being, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  brief consumer tips..

If you would like to learn more about our book, which deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

Love the New Car? Wait! Don’t Drive it off the Lot Yet

When I was a kid in the Bronx, yo-yo “season” would come around each spring and every kid in the neighborhood would be walking around with his Duncan or Cheerio. Nowadays, yo-yo season can be an all-year thing … for unscrupulous car dealers. According to the Center for Responsible Lending, if you are dealing with an unscrupulous car dealership, when you make the down payment on your new car (it could be in the form of a trade-in), the finance guy has you sign a great financing agreement and leads you to believe the deal is final.Be careful before you sign for that loan

So you drive off the lot whistling a happy tune (the epitome of which would be “Whistle a Happy Tune”). Hours or days later, you receive a call from the dealer in which you are informed that the deal fell through. The caller asks you to come in and the salesperson tries to convince you to take a higher-interest loan, by about 5 percent. If you say, “No deal,” the dealer tells you that you have driven the car and informs you of the costs, which may include keeping your down payment (or trade-in) or charging you for wear and tear.

Solution: Never drive a new car off the lot without having a fully authorized financing agreement in your clutches.

**************

The Consumer Gal and I are about to have our book, Enough of Us – which deals with other subject matter – published. In preparation for the big event we need to concentrate on that project. So for the next eight weeks or so, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

Cleaning Your Ductwork Could Mean Getting Cleaned Out

According to Consumer Reports Money Adviser, having your home’s ductwork cleaned may clean out your heating vents … and your checking account. Unless, when you poke you head into the vent you see mold, there is no evidence that spotless ducts will make your life any easier or cleaner.

And according to the Environmental Protection Agency:

Airducts diagram (EPA)

Structural diagram of an air duct (EPA)

“Duct cleaning has never been shown to actually prevent health problems. Neither do studies conclusively demonstrate that particle (e.g., dust) levels in homes increase because of dirty air ducts. This is because much of the dirt in air ducts adheres to duct surfaces …  air ducts are only one of many possible sources of particles that are present in homes. Pollutants that enter the home both from outdoors and indoor activities such as cooking, cleaning, smoking, or just moving around can cause greater exposure to contaminants than dirty air ducts. Moreover, there is no evidence that a light amount of household dust or other particulate matter in air ducts poses any risk to your health.”Money Adviser also warns that poorly trained workers might damage your heating system. Companies that offer free “tests” will claim to find mold and then hike the initial cleaning price quote.If you decide to have your ducts cleaned after an inspection, ask the sales rep to show you exactly what he found and to put into a written contract what process the company will use to do the job. Before you sign on the dotted line, check with your local Better Business Bureau (www.bbb.org), Yelp!, and your local consumer protection agency (it might be your state’s attorney general’s office).

 **************

The Consumer Gal and I are about to have our book, Enough of Us – which deals with another realm – published in a few weeks. In preparation for the big event we need to concentrate on that project. So for the next eight weeks or so, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

 

 

 

So-called “Convenience Checks” are Convenient . . . for the Banks

You know those “convenience checks” that come with your monthly credit card statement?

Convenience checks

Convenience check promotion with an low introductory rate

They’re for suckers. Here’s why. When you use them you’re usually charged the daily cash advance interest rate of 12, 15, or even 20 percent. Often they come with a 3-4 percent fee. When you make purchases with them you don’t usually accrue the benefits—like airline miles, cash back, and the extended warranty benefit —that come with credit card purchases.The low introductory interest rate may quickly disappear and if using one of these checks causes you to exceed your credit card limit, it could cause the check to bounce and to hurt your credit score.Shred any checks that you receive. Better yet, resist temptation, as I have done, by calling your card issuer and telling it to stop sending the checks.

**************

The Consumer Gal and I just had our book, Enough of Us – which deals with another realm – published. In order to concentrate on that project I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

 

You may Have $ Coming to You!

Unclaimed money site

Unclaimed money site

All types of financial transactions go awry. Perhaps a bank, or retirement fund, or former employer owes you money, but they’ve lost track of you. Such funds end up “on hold” in the treasuries of respective states.

For instance, I just discovered that my late mother-in-law has pension money from a former employer here in California coming to her. It amounts to a whopping 13 cents! Oh well. In a few short moments you can find out if you or one of your relatives has some serious cash coming.

Just go to www.unclaimed.org to find out if your Caribbean vacation awaits you.

**************

The Consumer Gal and I are about to have our book, Enough of Us – which deals with another realm – published in a few weeks. In preparation for the big event we need to concentrate on that project. So for the next eight weeks or so, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

Ways to Spot an Emailed Virus.

Two types of viruses are contaminating the landscape. One is influenza. The other is all those email viruses concocted by mentally ill people who have no self-esteem and who want make an impact on society, no matter how useless and negative.

There are lots of folks who have had their email contact lists compromised and who are spreading viruses without knowing it, that is until their contacts tell them about it. Here are some ways to detect these insidious little buggers.

Be very careful about messages that are not truly personal even if they have your name in the subject line. The body of the email usually goes something like this:

“Hey Bob, you really have to check this out http://www.9dfkr.ibl-finance”

Notice, there really is no personal communication, except for your name.

Also, be careful of extensions in the email link like .exe, .scr, or .pif, which are the most common extensions of viruses.

If you click on one of these links, you compromise your contacts list and everyone in your list is likely to have the same virus sent to them.

If you receive such a virus, notify the person who unknowingly sent it to you and then delete it

 ******************************

The Consumer Gal and I are about to have our book, Enough of Us – which deals with another realm – published in a few weeks. In preparation for the big event we need to concentrate on that project. So for the next eight weeks or so, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

I’m going into semi-hibernation for the next two months.

For those who regularly visit this blogsite, I want to say thank you both (har, har).

The Consumer Gal and I are about to have our book, Enough of Us – which deals with another realm – published in a few weeks. In preparation for the big event we need to concentrate on that project. So for the next eight weeks or so, I will be suspending my semi-monthly Consumer Guy full-length blog posts and, instead, providing  a short consumer tip each week (I hope).

If you would like to learn more about our book that deals with issues of ethics and procreation, please visit our other website, www.enoughof.us. Many thanks for your interest.

When Firefighter (or Police) Charities Call, Hose Them Down

Have you ever received a call from someone that sounds roughly like this: “Hello, is this Mr. Farfegnoogle? Hi, my name is Nigel and I’m calling on behalf of the Firefighters Benevolent Association of Aardvark County. Each year we donate to (Toys for Tots, the Widows and Orphans Fund, a local hospital burn unit, you name it), and we are hoping we can count on your support for this very worthwhile cause.”

You may wonder, “How much should I donate?” Well, here is a handy donation calculator: Figure out how much money you have in your bank account and multiply it by 0. In other words, donate nothing, zip, nada, naught, bubkes. The odds are overwhelming that the “charitable” campaign is a scam; that the organization that endorses it—while likely a legitimate association—is in cahoots with the fundraising outfit that just called you; and that most of the money goes to the fundraiser.

“What,” you say, “Are you telling me that the Firefighters Association isn’t on the up and up?” To which I say, no, it’s the fundraising company that isn’t on the up and up, and the legit organization is willing to go along for the ride in order to get a small cut of the take.

In my days as a TV consumer reporter, I conducted several investigations into these operations, and here’s what I found. There are two basic types of schemes. In each case there is a legitimate organization—I’ll refer to it as the Association—and a fund-raising company, which I will call the Fund-raiser. In the first type of scheme, the Fund-raiser offers the Association a fixed fee, say $5,000. The Fund-raiser then uses the Association’s name to raise all the money it can in the Association’s name, but the Fund-raiser keeps all the proceeds.

With the second type of scheme, the Fund-raiser offers the Association a cut of the gross take, say 15 or 20 percent. In either case, a very small percentage of the proceeds goes to a good cause. Why do the Associations do it? They get a chunk of cash to donate to a worthy cause without having to do any work. Is it ethical? Not in my book.

The Better Business Bureau has developed a set of standards for charities. Included in these standards are three benchmarks that relate to the issues I am discussing. The charities must:

 

  • Have a board of directors that provides adequate oversight of the charity’s operations and its staff.
  • Spend no more than 35% of related contributions on fund raising. Related contributions include donations, legacies, and other gifts received as a result of fund-raising efforts.
  • Spend at least 65% of its total expenses on program activities.

 

These are minimum standards. Most legit charities should, and do, spend a much higher proportion of their expenses on legitimate program activities. No responsible organization should allow big-profit fund-raising companies to represent it.

If you are determined to donate to the nonprofit organization, try this: Ask the Fund-raiser how much of the proceeds go to the nonprofit. Let’s say the amount is 25 percent. Instead of giving the Fund-raiser a $20 payment, send the nonprofit five bucks directly. Your total contribution will equal the amount it would have collected from the Fund-raiser and you will save yourself three-fourths of what you would have “donated.”

But never contribute to an organization that gets a flat fee up front. In that situation the nonprofit has already received its payoff from the Fund-raiser. So whatever you contribute goes into the fund-raiser’s pocket.

Here’s one more twist on the Fund-raiser appeal. Sometimes the caller will tell you about a special event the Association is putting on for disadvantaged kids. It might be a circus or a rodeo (there’s nothing quite as entertaining as animal abuse to amuse children) or a holiday party. Don’t be fooled. The Fund-raiser still gets most of the money and the one such rodeo I witnessed was pitiful.

Look out for Sneaky Contract Terms

I recently came across a magazine article that goosed me into writing about something that has rankled me for a long time. I guess I had to come across this issue elsewhere before I heard my internal wake-up call to write about this issue.

I’m talking about the one-sided contracts with unconscionable clause that most of us sign because we are – or perceive ourselves to be – powerless. The worst of the worst are arbitration clauses. If you want to open a bank account, use an Internet service, or sign onto Netflix, you’ll probably have to agree to a clause that says if you have a dispute with the company, you agree to take it to arbitration, often an arbitration company selected by the vendor. The problem is that arbitrators are notorious for siding with the parties that give them the most business. And that ain’t likely to be you. Adding insult to injury, you may have to share in paying the arbitrators’ fees.

A typical contract arbitration clause

Arbitration clause. photo- CreditInfocenter.com

Recently, each time I logged onto Netflix I saw a banner at the top of the page telling me to read and agree to a change in the Netflix contract. I read the change. It was a requirement that all disputes be settled by arbitration. So I ignored it. The notice was there each time I logged on. After a while I was warned that time is running out. So I let time run out. I never agreed and the banners went away. I guess Netflix would rather have the business of those who wouldn’t agree than lose them as customers. After all, they know we can visit our local Redbox.Here are some tricks you can try to avoid arbitration requirements. If you must agree to an online contract, go ahead. Then email the company’s customer service department and tell them you rescind your agreement to subject disputes to arbitration and that you reserve your right to take disputes to court. Send the email from your own email account; not the company’s “Contact Us” link, and keep a copy of your message. If you don’t hear back, you may be in good shape. If they send you an “either, or” response, you’ll have to make a choice.If you are signing a paper contract, cross out and initial the arbitration clause. If they don’t notice the change, you may be in like Flynn.If you receive a contract by email that you are to print, sign and mail back, yahoo! (Not the Internet service provider – just old fashioned “yahoo.”) Delete the arbitration clause, print the contract, and sign it, and mail it in, keeping a copy for yourself. If the company doesn’t notice the change, too bad for them.  It should have read it before it signed. Just make sure you get a returned copy signed by the appropriate company official. If they can try to slip one by you … turnabout is fair play.

Has your bank, brokerage, credit card company, cable TV provider or any other business ever slipped a little sheet into your statement or bill that notifies you of changes in the terms of your agreement? Read it! If you don’t like what you read, call the company and tell it how you feel. If necessary, take your business elsewhere. If the change of terms is significant, it could give you a way out of your contract with your cellular service company, Internet provider, or the like.

I’ll finish with this. When you get a bill for any utility service that is not a government sanctioned monopoly, like for instance, your electricity provider, check the fees on the statement. There may be a lot of small dings on the bill for just pennies or dimes. Call the utility and ask them to explain each fee and whether it is required by the government as a tax or fee. Many may not be. If so, it’s time to negotiate including the polite threat to take our business elsewhere. Think about it this way: If they say your service (exclusive of taxes and government fees) costs 50 bucks, but they are charging you $54, that’s a four-dollar, or 8 percent – rip-off. While the service provider may not reduce those fees, you threat to leave may prompt them to offer you an extra goodie at no charge. Recently, when I threatened to leave my cable company, the phone rep called me back and offered a “tier” upgrade and a 10 dollar monthly price reduction for six months.

Remember my motto: “Whoever holds the money, has the power.”