In an alarming statistic reported by Forbes, 42% of people in the United States have experienced some type of credit card fraud occurring to their account. After the card information has been stolen, an average amount of $5,000 in fraudulent activity occurs before the problem is fixed. Although credit card companies and banks are doing more to prevent this issue, it is, unfortunately, still up to the card holders to do as much as they can to prevent credit fraud.
We recently put together an infographic outlining the strange life of a stolen credit card — today we’d like to discuss our top 5 ways to prevent credit card fraud.
1. Manage Your Physical Cards Carefully
One of the best ways to prevent credit fraud is to carefully manage your physical cards. First, carry only the card you need that day and leave the rest at home. This way, if your wallet gets lost or stolen, you only have one card to monitor or cancel. Also, if you feel comfortable carrying cash to pay for dinner and other events where your card temporarily leaves your sight, you might consider taking this route.
Males should try keeping their wallets in their front pockets where they can be seen and felt at all times to reduce the chance of getting pick pocketed. Ladies should also consider keeping their cards in their front pockets—and separated from their other personal items in case their purses get lost or taken from them. Wallets in back pockets and hanging purses are easy targets for thieves, so both men and women can keep cards in front pockets for more safety.
2. Shred Credit Documents
Since they can be easily used to commit fraud, credit documents should always be properly and safely disposed of. Ultimately, shredding is the best way to dispose of credit documents. Because someone can easily dig through your trash and piece together big fragments of paper, simply ripping up the documents and throwing them away isn’t enough to prevent fraud.
If you are someone who gets credit documents in the mail, you might consider buying a paper shredder. You can also visit a document service center with a shredder and pay a small fee to have the work done.
3. Pay Bills Electronically
Another way to prevent stolen paper statements is to get rid of them all together. Consider paying your bills online where there are no documents to shred and no trash to go through. You might also try to get many of your bills automatically withdrawn every month. In general, with e-billing, you enter your credit information once and won’t have to possibly jeopardize the information on a month to month basis.
There is a greater chance that credit fraud will take place in a physical form instead of a digital one, so dealing with bills electronically as often as possible is best. As a final note, avoid giving your credit information over the phone if there is a way to enter it electronically — many credit fraud cases occur with over-the-phone transactions.
4. Fully Destroy Old Credit Cards
Just as when they are looking for credit documents, people often dig through trash to look for old credit cards. Unless the credit card is disposed of properly, it can be found, often put back together, and used. When you do need to dispose of a credit card, it is important to destroy the most useful information.
First, destroy the magnetic strip on the back with a powerful refrigerator magnet. Next, make several cuts over the name and number on the card, so that information can’t be read for future use. Finally, spread out the credit card through several different trash bags to make it even harder to put back together.
Burning the card is also an option — and perhaps the best method of all — but the fumes are often toxic, so do this carefully if you decide to go this route.
5. Closely Watch Your Online Banking and Statements
Watch your online banking or paper statements as often as possible to prevent these credit issues. Keep track of what you spend with detailed receipts and notes, and then cross reference that information with your bank’s records. If you have a charge that doesn’t match what your records show — and especially if the charge is from a business or city you didn’t go to — call your bank or credit company immediately to discuss the claim.
Caution and awareness are always the two best ways to prevent credit fraud.
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