Prepare your money plan_2

First Things First 45 You can place fraud alerts on your credit reports for free by contacting a credit bureau. Ideally, you should only need to contact one of the three. It is supposed to forward the request to the other bureaus. However, evidence shows that this doesn’t happen all the time. So, if you’re going to place fraud alerts on your credit files, contact all three bureaus: TransUnion: 1-800-680-7289 Equifax: 1-800-525-6285 Experian: 1-888-397-3742 Use your cell phone number as the fraud-alert contact number. That way, if you’re applying for credit, the creditor can call to confirm your identity quickly, no matter where you are. However, there are problems with fraud alerts. First, alerts expire every 90 days. So, you need to continually renew fraud-alert requests. This is essentially what the heavily advertised LifeLock and similar services do for you. Second, creditors are not required to double-check identity just because there’s a fraud alert on file. It’s merely a suggestion. So, your effort might be wasted. Alerts were meant to be used by victims of iden-tity theft. However, because consumers can place free 90-day alerts on their credit files, many peo-ple implemented fraud alerts as a preventative measure—again, some through services such as From the Library of Wow! eBook 46 The 1-2-3 Money Plan LifeLock. As a result, fraud alerts became useless because many creditors ignored the warnings. It’s like the fabled boy who cried wolf. So, often, the alert didn’t really signify a potential identity theft. After a while, creditors started ignoring the warning. Third, you might have a hassle getting on-the-spot credit, not only for credit card applica-tions, but also for signing up for a wireless phone plan, for example. If the creditor pays attention to the fraud alert, it will contact you before approving the application. Credit Freezes A credit security freeze is far more restrictive than a fraud alert. If you place a freeze on your reports, no creditor can access your credit file until you “thaw” it—provide permission by sup-plying a personal identification number that unlocks the reports. Unlike an alert, freezes don’t expire every 90 days. Most freezes are permanent until you lift them, whereas others are good for seven years. For state-specific information on security freezes, go online to FinancialPrivacyNow.org. The distinction between fraud alerts and credit security freezes is the difference between a bur-glar alarm and an impenetrable door lock. One tells you to worry about a thief; the other never allows the thief in. From the Library of Wow! eBook First Things First 47 But, there are hassles. Most people have to pay a fee every time they freeze their credit and again when they thaw it. A typical fee is $10 per credit bureau, or $30 to place a freeze with all three bureaus. And, your credit is locked down tight. So, you won’t get on-the-spot credit until you thaw it. That also means a potential employer might not be able to run a credit check until you thaw your credit, at least with the bureau that it uses. This delay problem seems to be getting better, however. In late 2008, the credit bureaus were lifting freezes in about 15 minutes, instead of the three business days called for in many state statutes. If I had a reason to believe my personal information was compromised, I would use a credit freeze. Or if it helps you sleep at night, go for it. Otherwise, I wouldn’t bother. Again, a fraud alert is pretty useless. Don’t bother. And definitely don’t pay any company to place fraud alerts for you. Banking Not that many years ago, you would choose a bank from the few available in your town or city. You visited the bank and filled out paperwork to open new check-ing and savings accounts. To become a member of a consumer-friendly credit union, you had to work for an employer affiliated with that credit union. From the Library of Wow! eBook 48 The 1-2-3 Money Plan Today, things are far different. For one, the choices are so much broader. You can choose among hundreds of banks across the country. You can open an account by filling out forms on the Internet and electronically transferring money into the account, which isn’t as dif-ficult as it sounds. As for credit unions, most people nowadays qualify for at least one. No matter what accounts you investigate, keep one main criterion in mind: No fees! Or as few as possible. You shouldn’t have to pay a bank to hold your money. The implied deal is this: They get use of your money. In return, you get use of a bank account and some meager amount of interest. Obviously, a fee for bouncing a check is reasonable. But so many others just aren’t. Here’s a generalization that will draw criticism, but it’s true most of the time: The huge national banking behemoths are probably not the right bank for you, or any consumer. The fees are likely to be numerous and expensive, and the service is likely to be lousy. And as we saw with all the bank failures and bailouts during the financial crisis of 2008 and 2009, big banks are cer-tainly no safer. Get the Bank Accounts You Need, 1-2-3 1. Get a no-fee checking account. 2. Set up at least one high-interest online bank account. 3. Join a credit union. From the Library of Wow! eBook First Things First 49 1. Get a No-Fee Checking Account Checking accounts are probably your most important account. A checking account is your command center, where all the action is. Money is coming in and going out every week. It’s also where you can get ripped off with a plethora of bank fees. So, it’s important to get a suitable account that’s not going to cost you money. When the first priority is to limit fees, make sure you get a free checking account, which means no monthly charge and no minimum balance, unless you’re certain you can regularly meet that minimum balance require-ment. You should also have unlimited check writing and free use of your debit card, whether you use a PIN code or sign a sales slip. You can even find accounts that don’t charge ATM fees for using the wrong bank’s teller machine. Others will rebate a certain dollar amount each month for using “foreign” ATMs. Here are criteria you might judge a bank on, when it comes to checking accounts: • Online bill paying • Interest on balances • Overdraft protection • Unlimited check writing • Free linked accounts • 24-hour automated banking • Free or discounted check printing • Nonbank ATM fee rebates • E-mail alerts • Debit rewards card • Downloads to Quicken or Microsoft Money • Mobile banking services From the Library of Wow! eBook ... - tailieumienphi.vn