Listening to a steady stream of advice flowing from my grandmother’s lips during the entirety of my growing up years, you’d have thought she published the world’s largest collections of “Maxims to Live By.” Of course, if the world had listened to and followed her wise counsel contained in such memorable statements as “Neither a borrower nor a lender be,” I wouldn’t be writing this blog.

Because I enjoy the convenience of credit and debit cards, or perhaps because avoiding credit wasn’t a “lesson I learned early and harmlessly,” I have to face the fact that having my credit card or my credit card number stolen is a very real possibility as it is for anyone who carries credit cards. I’m not exempt just because I write this blog. However, knowing “an ounce of prevention is worth a pound of cure,” there are steps both you and I can take prior to having cards stolen that will help if that event ever takes place.

First, carry a minimum number of cards in your wallet and never carry a social security card.

Second, it’s recommended that you keep a photocopy of both sides of every card you own. This file of paperwork should be kept in a safe place separate from where you keep your credit cards. If an actual photocopy of every card seems like too much paper to keep track of, you could instead keep a one-page listing of the pertinent information. This list would include the name of the institution issuing your credit card, your credit card account number, and the phone number to call to report a lost or stolen card. This list needs to be on a hard-copy, paper format. (If you keep such a list of information stored on your computer, caution needs to be taken in doing so…but that’s another blog entry.)

When it comes to stolen credit or debit cards, “timing is everything.” A quick response to the situation is your best protection.

If the worst happens and your wallet is stolen, you immediately need to use your list to phone the companies that issued your stolen credit cards to report them as stolen. Timing is essential here. The Fair Credit Billing Act (FBCA) limits your liability to $50 on a credit card reported as stolen. The Electronic Funds Transfer Act (EFTA) limits the amount of your liability on fraudulent transfers or ATM withdrawals based on how quickly you report the ATM/debit card as stolen. If the loss is reported within 48 hours, your liability is only $50, but if the time period is more than 2 business days, you could be liable for up to $500. If you neglect to report unauthorized use of your ATM/debit card within 60 days of the bank statement showing the unauthorized access, you will be liable for the entire loss.

In dealing with stolen credit cards, it is best to document in writing everything that is done. Record the date and time of your phone calls to the credit card issuers. Be sure to record the name and ID # of the representative handling your report. Take notes on your phone call. After completing the rest of the steps necessary in dealing with the theft of your credit cards and wallet, summarize the content of your phone call in a written letter to the credit card company. Keep a copy of each of the letters you sent, and perhaps consider mailing the letters return receipt or signature confirmation. The point is to create a paper trail that documents your actions just in case anything comes up for dispute at a later time.

After reporting the stolen cards to the issuing company, file a report with your local police (or, if you are away from home, with the police where the theft took place).

Be sure to contact each of the national credit reporting agencies by phone. Report your stolen credit cards and request a credit freeze be put on your account. You will create a password that must be used to remove the freeze. If your identity has been stolen, this service will be free. Otherwise, each credit agency will assess a small fee both to initiate and to remove the freeze. Again, it is wise to document these phone calls and mail a follow-up letter summarizing the requested action to each of the credit reporting agencies.

Contact your state’s department of motor vehicles to report your license as stolen and obtain a new license. Be sure the license number is different from the number on the stolen license. Contacting the social security office is essential if you broke the rules and carried your social security card or number in your wallet. In this age of identity theft, it might be wise to speak with one of their representatives about the loss of your wallet even if you didn’t have your social security card tucked inside.

Once the immediate, initial wave of contacts reporting the loss of your credit or debit cards has been made, you should keep a vigilant watch on your bank statements, credit card statements, and other bills. If there is any unauthorized activity, report it immediately.

Being prepared and acting quickly will ensure you minimize your loss in the event of stolen cards. Like grandma always said, “Wise people are diligent.”

Seems like daily there are news reports concerning yet another case of identity theft or credit card fraud. Who are the typical victims? Are they the nice elderly couple down the street who are so trusting and big-hearted? Or perhaps the high school and college-age kids who believe they are invincible as they step out to conquer the world and make a place for themselves? Surely it isn’t the savvy white-collar business man who drives his Lexus by the house everyday on his way to work.

The truth is, none of us is exempt from the all-too-real threat of potential credit card fraud, which is a big part of identity theft. In reality, no one can guarantee that your credit card numbers won’t be stolen or that your identity won’t be accessed by a criminal. However, there are several pro-active measures we can take that will reduce our risk ratio.

I have a friend who is a general contractor. He has encountered many, many remodel projects that were  initiated because of a minor problem that wasn’t recognized and dealt with early with just a simple repair. Often the problem itself could have been prevented if, in the original construction process, protocol had been followed and shortcuts had been avoided. After listening to him tell of an incident where he had been called to make what the home-owner thought would be a minor repair but that turned out to be quite a restoration project, I asked him how he discovered the source and extent of the actual damage not readily noticeable to the average person. His response intrigued me and has become a bit of a guiding principle in my life: “You have to think like water.”

The lessons I learned from my friend the contractor are principles I have applied to protect myself and my family from credit card theft. Principle one: Follow protocol. Principle two: Don’t take shortcuts – ever. Principle three: Think like a thief.

When I was young, my grandparents traveled in Europe. The only thing they really had to worry about was preventing the actual physical theft of their cash and traveler’s checks. My grandfather bought a money belt to wear under his clothing and religiously carried their money and checks in it. He knew the high rate of pick-pocket crimes in the area they were visiting and had friends who advised him that a money-belt was the safest way to go. My grandfather applied all three principles.

Today’s world is a bit more complicated than that of my grandparents, but there are still proven protocols we can use to protect ourselves from credit card fraud in today’s high-tech world. Obviously, we still need to be sure our cards are not physically stolen. It’s a wise idea to only carry a couple credit cards and an ATM card in your wallet. If you can force yourself not to, don’t carry a debit card. Debit cards are so convenient to use, but carry a much greater risk than a credit card. Generally, if a credit card is stolen, the Truth in Lending Act protects credit card holders from being liable for no more than $50 of the loss. Debit card carriers whose cards are stolen are at risk of having their entire checking accounts wiped out, and they have no protection. (If you use debit cards, access the card company’s on-line service to monitor your account weekly.)

The second thing we can do to protect physical access to credit card numbers is to buy a paper shredder and faithfully shred everything with any personal information. Everything. Every time. No shortcuts. A list of items to shred would include credit card statements, credit card applications, loan applications, pre-approved credit offers, credit card receipts, etc. In addition to shredding paperwork you are disposing of, spend the extra money to install a mailbox with a lock or contract for a PO Box to protect the paperwork you are receiving. Locked mailboxes aren’t fool-proof, but they are a deterrent.

The electronic age has presented many more threats to my credit card safety than my grandparents ever dreamed of. Awareness and diligence is a key to protection. Anytime your credit card leaves your hand, don’t let it leave your sight, and watch carefully the way the waiter or the retail cashier swipes the card. Hand-held devices called skimmers are used by criminals to store information found on a credit card’s magnetic stripe until a time when the criminal can download it onto a computer. It would only take a second to swipe the card with a skimmer before swiping it for your purchase.

One of the biggest targets for criminals intent on credit card theft is your personal computer. It is imperative that you install a firewall to protect your home computer from hackers. This is especially necessary if your internet connection is through DSL or cable. While you are installing a firewall, also spend the money for a good virus protection software and pay the subscription fees for regular updates. This protection will prevent worms or viruses from capturing information entered onto your computer and sending it out.

If you store files that contain sensitive personal data including credit card information, bank account numbers, investment information, or passwords, protect those files with passwords.

Criminals target naïve people. Keep yourself educated on recent scams involving the internet. Be assured that banks and credit card companies never, ever, ever contact customers through emails that ask for identifying information or account numbers. “Phishing” emails will contain your bank’s logo and other graphics and look like official correspondence. They will direct you click on a link that opens a page very similar to the bank’s online website where you will be asked to enter account information. Do not click on the link. Do not enter your information. Ever. If you have questions, call your banking institution or your credit card issuer.

In the same vein, do not give out your credit card information or any other identifying information (debit card, social security number, etc.) to anyone else soliciting it over the internet (or phone or mail) unless it is to a business you trust and unless you have made the initial contact with the company.

Be cautious about your online shopping. Only purchase things with a credit card online if you are positive that the reputable business is offering a secure transaction site. When you hit a “checkout” or similar button, you should be taken to a page that has a prominent graphic or dialogue box containing a notification of security. You can also glance at the url in your browser to see that the address begins with https:// - look for the “s.” You should never email your credit card information to anyone. Email can be hacked into. If a company does not have a secure site through which to complete a transaction, use PayPal or find another source for the item you wish to purchase.

Beware of your children’s internet activities. Protect your computer from being able to download programs without password-approved permission (and don’t give your kids the password). There are many file-swapping or file-sharing programs on the internet that can be interesting or fun, but they are easy ways to expose yourself to hackers.

If we are as diligent about protecting our credit card numbers and personal information as thieves are about stealing it, if we follow established protocol and never take shortcuts or make exceptions to the rules, we can go a long way in reducing our personal risk of credit card fraud and identity theft.

In the past, it has been easy to handle different situations that may arise with your credit card company. The simplest solution has been to get a new credit card. However, with the newest credit crunch, this is no longer an option.

You do have several options if your credit card company cuts your credit limit. Don’t just “take it” because a lower credit limit can hurt your credit score. Here’s how you can fight back.

1. Fight back. First of all, fight back. If you limit gets lowered, call the credit card company immediately and try to negotiate a higher limit. Make sure you point out that you have a spotless payment history. They also need to understand that you used to have “healthy” debt to credit ratio. Don’t just talk to the first person you reach. Ask for supervisor after supervisor until you’ve worked your way up the ladder.

2. Pay it off. If your credit score drops because your credit card company lowered your credit limit, pay off the balance as quickly as possible. Your credit score probably dropped because there isn’t as much available credit anymore. Pay down the balance and get that ‘available credit’ open.

3. Request a limit increase. Just because you’ve taken a hit with one credit card doesn’t mean you have to take a hit with all of them. Call the other companies and request a credit limit increase. You have to be extremely careful with this, because if it backfires, it could damage your credit score more than help it. If the company does a “soft inquiry” by not pulling a new copy of your credit report, your score won’t be affected. However, if it does a “hard inquiry” by pulling a new copy of your credit history, it could lower your credit score for an entire year. If you can request a limit increase online, it is probably a “soft inquiry.”

4. Open a new credit card. This option isn’t for everyone. Your credit score has to be fairly good these days open another (just because your current credit card company lowered your limit). Your credit report will take a short-term hit because of the inquiry and the new line of credit.

5. Do NOT cancel the card. Many people make this mistake by trying to get even with the other credit card company. Don’t do this. Simply don’t use the card. Having that card available, yet empty, will help your credit score.

Don’t let your credit card company lower your credit limit without a fight. Take a stance. Follow these steps to preserve your credit score and available credit limit.

For me personally, the answer to that question is a resounding yes! Customer service isn’t just about talking with someone on the phone or at a counter and having them answer my question or conduct a transaction for me. It’s more about my overall impression of the entire experience; the atmosphere, the goods or services and the way I was treated makes the complete package, not just some salesperson sucking up to me to get a sale. I understand that not every person at every company has the capacity to perfrom at such a standard every time, but there are a few companies out there who just seem to get it right while others can’t.

Take for example two credit card companies - USAA and American Express. Both companies have received the highest rankings for customer satisfaction, one from Consumer Reports and the other from JD Power and Associates. Is this a coincidence that I have accounts with both of these companies? Not exactly. USAA is more by coincidence for me, but without surprise, while American Express is solely by choice. My experience with both of these companies has been excellent and it is no surprise to me that either of these companies receive high ratings from other customers and ultimately from organizations like Consumer Reports and JD Power and Associates. Using a credit card from American Express does come at some cost, but I knew that before I became a customer. To me that additional cost or slight inconvenience is more than worth it.

Just like you I’ve also had bad customer service experiences too. For many years I used cellular services provided by Sprint because I was getting a “great deal” (price) on my monthly bill. However, anytime I had a problems with my phone or service,  I had to go to a Sprint store where I expected to leave there completely frustrated with my blood near its boiling point. Sure the reps were nice for the most part, but no one could ever seem to really help me or fix my problem. Why I stayed with them for so many years, I don’t know, but I now recognize the money I saved on my monthly bill was not worth it at all. When the opportunity to switch to a different provider presented itself, I did so without hesitation. The money I saved resulted in a lot of frustration and an overall bad customer service experience.

So I beg the question, does customer service influence where you shop or which companies you use? For me the answer is clear, I would rather pay more, sometimes a lot more, to have customer service experiences like those I’ve had with USAA and American Express. Leave us your comments and feedback.

People generally have different misconceptions about credit cards. It is important for you to make good credit card decisions. Make sure you don’t make these costly credit card mistakes.

1. Minimum Payments. Paying only the minimum payment can be extremely costly. You will end up paying a lot of interest if you don’t pay off your credit card each month. You will also become enslaved to your credit card balance, never being able to get out from under it.

2. Cash Advances. Credit card companies make you think that cash advances allow to get free money. When they don’t advertise is how much interest you’ll be paying each time you take a cash advance. Most times, you’ll be paying over 25% for each advance.

3. Budget with Your Card. Don’t make the mistake of thinking that you can buy whatever you want now and pay for it later. This is an easy way to get way over your head in debt. Stick to your monthly budget. If you use your credit card, especially to earn rewards, make sure you have the money in your checking account to back it up.

4. Late Payments. Never make a credit card payment late. You will be charged a late fee and end up paying a lot more for that tank of gas than you intended. Always pay off the entire balance on your credit card a few days earlier. This will get you in the habit of making good credit card decisions.

5. Understand. Make sure you read the fine print and understand exactly what you are getting into. Know what introductory rate you’ll be paying, what the rate will be after the introductory period, what the late fee is, what your due date is, etc. When you apply for the credit card, you are entering into a contract with the credit card company. Make sure you know what the contract means.

6. Too Many Cards. Don’t get too many cards. Lenders do not look favorably on a ton of open revolving accounts. If you need one or two credit cards, get them. But, be careful you don’t have so many cards that you can’t keep up with each one.

7. Monthly Statement. Your monthly statement is your opportunity to review your credit card balance with a fine toothed comb. Review each statement carefully and make sure every charge is correct. This is also your opportunity to watch for identity theft. Your monthly statement is given to you for a reason. Read it carefully.

Be sure you are making good credit card decisions. In order to have good credit now and down the road, you need to be smart with your credit card. Don’t make any of these costly mistakes, and you’ll be on your way to great credit in no time.