Consumer news, tips, commentary and musings by veteran consumer and finance journalist Anthony Giorgianni
Contact me at anthonyconsumer@gmail.com
Also on Blogger
Should You Give Through Crowdfunding Websites?
Why You Should Consider having More than One Bank
Save Money By Doing Repairs Yourself
A $300 Oil Change For Your Car?
Think Twice Before Buying a Home Warranty
Buying a House? Choose a Home Inspector Carefully
Page 2
SPECIAL REPORT: Leasing a car is a lot more expensive than you think
Why You Shouldn't Keep Emergency Savings If You Have Credit Card Debt
Federal Shutdown Underscores Danger Of Living Paycheck to Paycheck
Nine post-holiday tips for gift givers and recipients
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Consumer Fraud:
The Storm After the Hurricane
Beware of bogus fundraising and home contractors as well as storm-damaged cars
9/15/18
As the South endures the effects of hurricane Florence (now a tropical storm), warnings already are being issued about another storm that's expected to follow, this one entirely man-made: Consumer fraud.
Even as Florence was approaching the mainland, alerts sent out about post-storm scams, including this warning from the Better Business Bureau.
There are at least three types of disaster-related fraud you should know about, even if you don't live in an area directly affected by the storm: Charity and contractor scams and the sale of flood and other storm-damaged cars to unsuspecting motorists.
Here's how these types of fraud work and what you can do to avoid them.
Charity scams
During my more than 30 years as a consumer and finance journalist, I've seen many examples of scammers trying to take advantage of the generosity of people who want to help those affected by hurricanes and other disasters. The fraud could be perpetrated using a website for a bogus charity that's been set up overnight to address a particular calamity. Or it may come as an unsolicited email or text. More recently, there have been bogus fundraising campaigns on crowdfunding sites such as GoFundMe, which I addressed in my previous post. Even if a solicitation is from a legitimate charity, the group may not be in a position to help in a given event, whether it's Florence or anything else.
How to avoid it. Don't let the threat of fraud discourage you from giving. People really need your help. But be careful. It's best to give to major disaster relief organizations, such as the Red Cross, that can provide immediate help, especially early on. Of course, you also should consider giving to groups that have committed to helping victims recover over the long term.
Typically, after a disaster, government agencies and legitimate organizations post lists of top-rated charities that are actually committed and able to help. A good place to check over the next few days is the charity watchdogs, the BBB Wise Giving Alliance, Charity Navigator and CharityWatch. Finally, beware of unsolicited donation requests that show up in your email or by text. Even if it appears to be from a charity you know, it could be a fake.
Contractor fraud
As the Better Business Bureau warns, so-called storm chasers often show up after a disaster offering to fix damage to homes and other structures. They're often scammers out to take advantage of people desperate for quick repairs at a time when there's a big demand on legitimate contractors. These roving scammers may say they can start work right away. They might even offer an unusually low-price, in some cases saying they have supplies left over from a previous job. They may steal your down payment or make shoddy repairs and then disappear. Conversely, some contractors, even licensed ones, may try to take advantage of people's desperation by quoting really high prices, in possible violation of state laws against price gouging.
How to avoid it. Use caution if a contractor shows up at your door soliciting work. If possible, ask friends and relatives for recommendations for contractors who are reliable and do good work. Check out any contractor you're considering. You can find reviews at the Better Business Bureau, Angie's List, HomeAdvisor and other websites. Also, try a web search with the contractor's name and such terms as "reviews" and "complaints."
Also check your state's contractor licensing or registration regulations, and make sure the contractor meets them. HomeAdvisor has a list of contractor licensing requirements by state. South Carolina requires contractors to be licensed if they perform more than $200 in renovations on a residential building and more than $5,000 on a commercial structure. In North Carolina, a license is required only for projects costing more than $30,000.
Hiring a licensed or registered contractor not only can reduce the chances of your being defrauded, it also can make you eligible for money in states that have special funds, such as North Carolina's Homeowners Recovery Fund, to reimburse victims of dishonest or incompetent licensed contractors.
Finally, comparison shop so you can determine a fair price for the repairs you need. Report any attempted price gouging to your state or local consumer protection agency.
Storm-damaged car sales
A third, long-term concern is the sale of storm-damaged vehicles to unsuspecting motorists. Televised storm footage as Florence makes its way through the South already is showing vehicles submerged in water. Eventually, some of those damaged cars and trucks likely will make their way into the marketplace. Some may even lack a so-called branded title. A brand is a state-mandated designation on the title document that's intended to warn to buyers of certain past events, such as if the vehicle had been flood damaged or declared salvage. And many car buyers, especially those purchasing from dealerships, never see the former title anyway. This is a serious problem because flood damage to a vehicles can be difficult to detect and impossible to repair.
Car history reports from Carfax, Experian and other providers may reveal flood or other types of storm damage. But you can't rely on them. I've seen many instances of clean history reports for vehicles that have flood and other serious damage, as I reveal in this Consumer Reports 2009 investigation.
Cream puff? This burned GMC Yukon on eBay has a clear title and at least three clean car history reports
Just today, it took me less than five minutes to find a seriously damaged vehicle on eBay Motors for which the seller boasted of a clear title and clean Experian AutoCheck history report. The report actually was displayed in the ad. I found that the burned 2008 GMC Yukon (see photo) also has a clean history report from the federal National Motor Vehicle Title Information System and the National Insurance Crime Bureau's VINCheck. (I didn't want to spend the $40 to check the vehicle on Carfax).
Damaged vehicles often command a higher prices if they have so-called unbranded titles and clean history reports because unscrupulous buyers can repair and resell them without disclosing the past damage.
Just today, it took me less than five minutes to find a seriously damaged vehicle on eBay Motors for which the seller boasted of a clear title and clean Experian AutoCheck history report. The report actually was displayed in the ad. I found that the burned 2008 GMC Yukon (see photo) also has a clean history report from the federal National Motor Vehicle Title Information System and the National Insurance Crime Bureau's VINCheck. (I didn't want to spend the $40 to check the vehicle on Carfax). Damaged vehicles often command a higher prices if they have so-called unbranded titles and clean history reports because unscrupulous buyers can repair and resell them without disclosing the past damage.
How to avoid it. When you're buying a used car, nothing beats an inspection by a competent mechanic, preferably one with experience in auto body work. Expect to pay at least $100 for this service.
Checking car history reports also can be helpful for the accidents, flood damage and other problems they reveal. But never trust a clean history report. Expect the seller to provide a Carfax or AutoCheck report at no cost, and then verify it with either company to make sure it hasn't been altered. VINCheck reports are free. You can obtain free NMVTIS reports from Carsforsale.com (free sign-up required).
And never buy a used vehicle without checking the title for a brand, such as "flood," "salvage" or anything else that indicates a problem that can affect the price you'd be willing to pay or your decision to buy at all. If the dealer doesn't have the title, perhaps because the previous owner's loan hasn't yet been re-paid, pick another vehicle.
If you're buying a used car from a dealer, ask the salesperson for the former owner's contact information. Then call the person and for ask details about the car's history. The dealer may balk or even claim that giving you the information violates federal law (it doesn't). In some states, including Massachusetts, dealers are required to identify the former owner if the name is available. You also may be able to find the previous owner's name on the title (except for prior leased vehicles, which often are titled to the leasing company) or, if you're lucky, somewhere on a document in the glove compartment or trunk.
Freezing and Unfreezing Your Credit File is
Now Free Nationwide
9/21/18
Under a new federal law, beginning today, you now can freeze and unfreeze your credit file at all three major credit bureaus for free. Freezing your credit is a good way to protect yourself from having someone obtain credit in your name.
A credit or security freeze restricts third-pary access to your credit file, greatly reducing the chances that a thief can use your identity to get a loan, credit card or other credit. Identity theft has become an increasing concern because of the growing number of data breaches at major retailers and other businesses, including last year's breach at the Equifax credit bureau. And using bogus email and phone calls, computer viruses and other methods, scammers have tricked consumers into handing over their date of birth, Social Security numbers and other sensitive information.
Until now, many states have allowed the credit bureaus to charge most consumers a fee to freeze and unfreeze their files. But the Economic Growth, Regulatory Relief and Consumer Protection Act prohbitis those fees.
The law also has other provisions designed to protect consumers from credit fraud. For instance, you now can freeze the credit files of your children who are under 16 years old. The law also requires credit bureaus to retain so-called credit fraud alerts for one year instead of just 90 days. Free fraud alerts are initiated by consumers, usually when they know or suspect that their personal information has been compromised. Alerts require businesses to obtain consumers' approval before opening new lines of credit in their names. Victims of identity theft still can get extended fraud alerts that last seven years.
A credit freeze is not without its downsides. For example, you must to freeze or unfreeze your file at all three major credit bureaus, Equifax, Experian and TransUnion, separately.
Then, when you apply for credit, you typically must unfreeze your file at one or more of the bureaus. While the law requires bureaus to lift a credit freeze within one hour for requests made online or by phone. even that can be inconvenient if, for example, you're standing in a checkout line trying to get instant approval for a retailer's credit card.
Still, that's not much of a hassle compared to what you'd have to deal with if someone obtained credit in your name.
What to do
Now that freezing and unfreezing your credit file is free, there's even more reason to do it, despite the hassles. And it's relative easy to request a freeze, especially online. You may even be able to manage your freezes file using a mobile app, such as the one from TransUnion, which is available at Google Play and the Apple App Store. Once you make a request by phone or online, a bureau must initiate the freeze within one business day. For a request made by mail, a bureau has three business days of receiving it to respond. Freezing and unfreezing your file doesn't affect your credit score.
When freezing your files, don't mistakenly opt for a "credit lock" instead. Though similar to freezes, credit locks offered by the credit bureaus are not covered by the new law, the FTC warns.
With a little planning, you can reduce or eliminate the hassle associated with lifting a freeze by doing it before heading out to a bank, car dealer or anywhere else where you expect to apply for credit. One trick is to try to find out in advance which bureau a credit issuer uses so you can lift only that freeze.
Usually it's a good idea to lift a freeze temporarily, for a period that you designate, after which the freeze will go back into effect.
When freezing your credit files, you may be given a personal identification number, which you'll need to unfreeze it, even temporarily. Don't lose it, and make sure no one has access to it.
Finally, even if you freeze your credit files, you still should check your credit report at all three major credit bureaus once a year, which you can do for free at AnnualCreditReport.com. Report any incorrect information or unauthorized accounts to the bureau immediately.
A freeze makes even more sense to stop credit fraud
Saving on Cable: It's a Crazy Game, But You Have to Play It
10/22/18
I wish there were a telecommunications company that would give me a fair price on my television, phone and internet service without my having to renegotiate the deal every year or two.
But it seems like carriers are more interested in attracting new customers than keeping their old ones. Knowing this can save you a lot of money, especially if you're willing to call your cable company's bluff and change your provider, at least temporarily.
Case in point: My carrier, Verizon, recently informed me that it was increasing my $149-a-month Fios bill by nearly 50 percent, to $219. When I asked why, a customer service representative told me that part of the reason was that my customer loyalty discount had expired. Expired? Why? Did Verizon catch me watching a TV with a competitor's service?
It's just one of those things in the telecommunications industry that doesn't make a lot of sense. But whatever Verizon's reason, I've been through these threatened increases many times before. And as unpleasant as I knew it would be, I was ready to do anything necessary to avoid shelling out anything like $200 every month for cable. It's bad enough that I've been forced to pay for sports channels and lots of other content I don't even want.
When I was a money writer at Consumer Reports in 2013, I penned this blog (pdf) about how I had successfully avoided an earlier Verizon bill increase. I compared the experience to a boxing match in which I took on one Verizon customer service heavyweight after another, suffering my share of uppercuts and jabs before finally declaring victory.
But it was short-lived. In 2016, Verizon informed me yet again that I should expect my next bill to look more like a mortgage payment. That time, nothing I said or did worked – until I canceled my service and switched to Cablevision (now Altice), which was offering me its Optimum service with more channels and other upgrades for substantially less. Suddenly Verizon saw me not as an old customer, who wasn't worth its time, but a valued new one. Now, for about the same price I was paying before, Verizon was promising me more stuff. Truthfully, I much prefer Verizon's service over Altice's Optimum, so with my new discount in hand, I reluctantly went back two week's later.
Naively, I had hoped that this would be the end of it. But here it is, two years later, and I've been facing another big Verizon increase. And like before, there seemed to be no way to avoid it. So once again I decided to switch to Altice's Optimum service, which was offering me dozens of more channels, twice the internet speed and even a $120 prepaid card for the same price I had been paying Verizon. This time I was determined to stay with Optimum.
But now it's week's later, and once again I've found that I just don't like Optimum, which I think in some ways is even worse than when I tried it in 2013. So just like before, I asked Verizon what it would do to get me back. And sure enough, it was a lot. I was now eligible for a new customer deal that had me paying slightly less than before, while adding HBO and increasing my internet speed ten times. And Verizon promised to give me a $100 prepaid card and $200 toward the purchase of one or more connected Google and Nest devices, such as an indoor or outdoor security camera or a video door bell.
Doesn't Make Sense
Of course, none of this seems to make sense. All I wanted was to avoid a big increase in my Verizon bill. Now I've not only successfully dodged the hike, but Verizon is giving me all these extras I never requested. And its technicians once again have to come to my home to reinstall the equipment that I returned to Verizon just weeks ago at the company's request. Is this any way to do business?
I asked a Verizon customer service rep, who told me that the company counts on the likelihood that most customers simply will accept a higher bill than go through the trouble of switching companies. If Verizon kept everyone at the rate I'm paying, she said, the carrier would lose money. I don't doubt it, given all the prepaid cards and other perks the companies are handing out to attract their competitors' customers. And that appears to be what's really going on. Existing customers end up having to pick the tab for all these new-customer incentives.
And what about Cablevision-Altice? In two years, it twice installed Optimum at my home only to see me go back to Verizon a couple weeks later. (All I've paid is for a few weeks of service and a $50 equipment activation fee.)
There has got to be a better way. Telecommunications companies have to figure out how to treat loyal customers so they don't have to go through this charade every two years or so. (Altice did offer me an additional $15-a-month discount to keep me from returning to Verizon. I just wish its service was better.)
What To Do
There are so many things that are more fun to do than comparing your cable company's prices, negotiating with recalcitrant customer service reps and, if it comes to it, changing back and forth among carriers. But until the telecommunication industry changes how it does business, you have to work within this crazy system to avoid being charged a fortune for sticking with your cable company.
So every year or two, or any time you're notified about a bill increase, take a look at what your provider and its competitors have to offer.
Start with the competition. Get its best deal and then try to do even better. Ask for more channels, faster internet speed, free installation and equipment or anything else you can think of. If you're bound by a contract with your current carrier, find out whether the new one will pay your early-termination penalty. But don't just call. Sometimes carriers' online offers are better than what their customer service reps can give you. For instance, with my new Verizon service, signing up online entitled me to free installation (regularly $99) and that $100 prepaid card, perks a Verizon phone rep insisted had expired until I threatened to stay with Optimum.
Once you get your best deal, find out what your current provider is willing to do to keep you. If you don't like the answer from the first rep you speak to or even a supervisor, try again. And do the same after you've given your carrier a formal disconnect notice in anticipation of switching companies. And if you do switch, you might even ask your old carrier what goodies it's offering for your return, especially if you don't like your new service.
It sounds like a ridiculous amount of work, but it's the absurd system the telecommunications industry has come up with. And if you play the game wisely, you can save a lot of money and perhaps even end up with improved service, as I did.
Sometimes switching carriers is the only answer
Make one mistake and you can be charged huge retroactive interest
11/6/18
Retailers' deferred interest offers, which let you buy now and pay later with little or no finance charges, are tempting, especially during the winter holiday buying season. But if you're not careful, these deals can backfire and end up costing you a lot.
A new study by the website WalletHub found that 82 percent of consumers don't understand how deferred interest programs work. In part, it blames retailers who bury the potential gotchas in fine print that's difficult to find and read.
"Deferred interest financing is like a wolf in sheep's clothing, pairing an enticing offer – something like 'no interest if paid in full' or 'special financing' – with a clause that allows the deal to turn ugly if you make the slightest mistake," says the study, which was based on a review of 73 large retailers' financing programs.
Deferred interest financing usually is offered in connection with retailer credit cards, though it also may be a feature of a stand-alone finance agreement. Customers can make one or more purchases, often with little or no money down, and pay zero percent interest as long as they make their payments on time and pay everything off by the end of the special financing period. That date can be as little as six months away or as many as six years in the case of big ticket items, such as furniture.
And there's the catch. If you pay late or have a balance after the end of the special financing period, you'll likely be charged full interest retroactive to the date of purchase. And depending on your credit rating and the retailer, the rate can be as high as 30 percent. But that danger often isn't clear, says the study. "Retailers typically don't list the regular APRs of deferred interest plans in (a) large enough font or in a prominent location," it says.
Many major retailers offer deferred interest financing plans, among them Amazon, Apple and Dell, Bed Bath & Beyond, Best Buy, Home Depot and Lowe's and Mattress Firm.
The study found that 79 percent of those who understand how deferred interest plans work think they are unfair, and 62 percent say the offers should be illegal. WalletHub says that 88 percent of deferred-interest retail credit cards are issued by just three banks, Synchrony, Comenity and Citibank.
What To Do
Use caution if a retailer offers you a zero- or low-interest financing deal. There's a good chance it's a deferred iinterest plan that could leave you paying full, retroactive interest if you're not careful.
Wallet Hub says there are better ways to finance purchases than by taking deferred interest offers,. One option, it says, is to apply for a true zero-percent credit card, which doesn't threaten you with retroactive interest. Instead, those cards let you make purchases (and sometimes balance transfers) that are interest-free for a year or so, after which the standard interest rate will apply only to any remaining balance.
Better yet. Try not to spend more than you can pay often a single month, especially during the holiday season. Make a realistic budget and stick to it. Be sure that it includes savings. Having a substantial amount stashed away can help you avoid going into debt during those periods when your monthly expenses can exceed your income, such as during the holidays. Remember, with any type of financing, you're essentially spending tomorrow's income today. And if you're already having trouble meeting your expenses, taking on debt or adding to the amount you already owe is likely to make things worse (more on that in a later blog).
If you feel you must accept a deferred-interest financing offer, be sure to make every payment on time and pay off the entire amount due by the deadline. Keep in mind that the find print on many retailer sites says that paying the minimum amount required under the plan won't necessarily mean that the full balance will be paid off at the end of the zero-percent financing period. So pay close attention.
Consumer Fraud:
The Storm After the Hurricane
Beware of bogus fundraising and home contractors as well as storm-damaged cars
Cream puff? This burned GMC Yukon on eBay has a clear title and at least three clean car history reports
Freezing and Unfreezing Your Credit File is
Now Free Nationwide
A freeze makes even more sense to stop credit fraud
Saving on Cable: It's a Crazy Game, But You Have to Play It
Sometimes switching carriers is the only answer
Consider Carefully Before Accpeting Store Deferred Interest Offers
Make one mistake and you can be charged huge retroactive interest
Consumer Fraud:
The Storm After the Hurricane
Beware of bogus fundraising and home contractors as well as storm-damaged cars
Freezing and Unfreezing Your Credit File is
Now Free Nationwide
A freeze makes even more sense to stop credit fraud
Sometimes switching carriers is the only answer
Make one mistake and you can be charged huge retroactive interest
Visit page 3 for these posts:
Use Caution With Free Trial Offers
Whether it's a scam or a "legitimate" deal, you can end up with unexpected charges
12/1/18
The Federal Trade Commission has issued yet another warning about free trial offers that can end up costing you money.
The agency announced on Wednesday that the U.S. district court in California has granted its request to temporarily shut down an alleged internet marketing scam that promoted bogus free trial offers.
The case underscores why you need to be careful about enrolling in free trials while shopping for the holidays or any other time. And even "legitimate" free trials can leave you with unexpected charges.
Consumers bilked for tens of millions of dollars
In the case announced Wednesday, the FTC accused numerous U.S. and United Kingdom-based companies and individuals with charging customers full price in connection with free-trial offers for more than 50 dietary supplements and personal care items. The products were marketed as promoting weight loss, hair growth, clear skin, muscle development, sexual performance and cognitive abilities, the agency said.
The complaint (pdf) says customers typically were told they had to pay just $4.95 for shipping and handling. But within two weeks, it says, the customers' credit and debit cards were billed for about $90. Customers also were charged for "complementary" products, and they were enrolled without their consent into so-called continuity programs that shipped them additional supplies of the products for around $90 monthly, the complaint says. It says the scam cost consumers tens of millions of dollars.
This is one example of numerous cases the agency has taken against what it says are bogus free trials.
"Scammers often use 'free' trial offers, with undisclosed or buried terms, to enroll you – without your knowledge – in costly membership programs," said a warning the FTC issued Wednesday.
In another case, a federal district court in July shut down a San Diego-based group of internet marketers that the FTC said charged customers about $98 for a free trial in connection with a variety of products, including skin creams, electronic cigarettes, and dietary supplements. As with the case announced Wednesday, the FTC said customers also were signed up and charged for additional shipments without their permission.
"Legitimate" free trials are troublesome, too
Scams aren't the only thing you need to worry about when it comes to free trials. It's easy to end up with unexpected charges even with legitimate offers from well-known companies. That's because when you sign up for many of these deals, you are agreeing to begin paying for a product or service if you don't cancel within a certain period after the free trial ends. But companies don't always make that clear on their websites or in other marketing. And even if they do, it can be easy to forget to cancel before the charges begin.
Consider this free trial offer from the genealogy company Ancestry, which has monthly memberships ranging from $20 to $45 and six-month memberships from $99 to $199. "Free trial requires registration with a valid credit or debit card," the website says. "You will be charged the full amount of your chosen membership price on expiry of the free trial, unless you cancel at least 2 days before the end of your free trial." And as with many such deals, your subscription renews automatically if you don't cancel at least two days before the renewal, another thing to worry about.
What to do
Don't accept free trial offers without carefully reading the offer, especially if you're required to provide a debit or credit card number or other form of payment. Try using a web search to see what others are saying about the company and the deal.
If you decide to sign up, use a credit card instead of a debit card and keep a copy of the offer. That way, if there's misrepresentation, you can dispute the charges with your card issuer. It's much more difficult to fight unauthorized or incorrect charges on your debit card. One trick is to use a temporary credit card number that some banks, including Citibank and Bank of America, will provide on request. The number, which is linked to your account, expires within a short period so that no one can bill your card again without your consent.
If there's a deadline by which you must cancel a free trial or ongoing service to avoid being charged or auto renewed, note it some place where you'll be sure to see it without having to remember, such as in an electronic calendar with reminders.
For more tips, visit the FTC website.
Ten Dos and Don'ts For Holiday Gift Giving
Watch out for fake sales, use a credit card for purchases, don't give gift cards and more
12/13/18
It's the holiday gift-giving season again. Here are ten ways to prevent ho-ho-hos from turning into uh-ohs.
DON'T assume that items on sale are a good deal. Many retailers go out of their way to make you feel like they're offering a great price on whatever you want to buy, whenever you want to buy it. Walk into some stores or check their websites, and almost everything seems to be on sale virtually all the time.
Consider this lawsuit tLos Angeles filed against JCPenney, Kohl's, Sears, and Macy's in 2016, accusing the retailers of essentially holding fake sales. Whether it's 40 percent off, buy-one-get-one-free, a free gift with every purchase or any other type of come-on, you must comparison shop.
Take for instance this deal for a three-quart Instant Pot Duo pressure cooker at Kohl's for $89.99. That price supposedly represents a $10 discount off the regular price of $99.99. But the manufacturer's suggested retail price for the same item is $79.95, $20 less than Kohl's "regular" price and $10 less than its sale price. Beyond that, after applying Kohl's 15 percent discount in effect until Dec. 24, the $76.49 net cost is more than $10 higher than the $65.01 deal on Amazon, which, like the Kohl's website, is offering free shipping. Buying from Kohl's might make sense if you'll use the $10 Kohl's cash the retailer is offering on purchases of at least $48 through Dec. 24. But you can spend that $10 only at Kohl's, and you must use it by Jan. 6, restrictions you wouldn't have if you simply purchased from Amazon. Bottom line: All these Kohl's discounts on that one product sound great, but it's not the amazing deal you may have thought it was.
DO use credit cards when shopping. Credit provides the best protection against fraud, misrepresentation, billing errors, non-receipt of shipped items and problems with an item's quality. Use a credit card, and you'll have the right to dispute the charges with the card issuer. That protection is especially important when you're dealing with an unknown online merchant. If you use a debit or prepaid card, check, or, worst of all, cash, it can be much more difficult or impossible to get a refund or otherwise resolve any problems. Of course, before shopping at an unfamiliar merchant, look for a report on the company at the Better Business Bureau. Along with checking the letter grade the BBB has assigned the company, read any complaints, reviews or r government actions listed in the BBB report. You also can find out what others are saying by using a web search with the merchant or website name and such terms as "reviews" and "complaints."
DON'T give gift cards. They may have cute pictures and give your gift recipients the feeling that you gave at least some thought to where they like to shop, dine out or get their hair done. But gift cards really are little more than cash with lots of restrictions, including on where you can spend the proceeds. Lots of gift cards end up sitting unused in drawers or wallets. Or they may end up being lost or stolen (many issuers won't replace them). And with so many retailers closing their doors or going out of business, card holders may have few or no outlets where they can even use their cards. (Unfortunately, card issuers aren't required to segregate gift card proceeds to protect them from bankruptcy proceedings. And few, if any, do.) Even bank gift cards, which carry a MasterCard or Visa logo, can be a problem. While your gift recipient can use them at many more locations than retailer gift cards, bank gift cards often have pesky fees that eat away at their value over time. Bottom line: If you can't think of a real gift, give cash or a check.
DO check retailer terms and conditions. This may seem obvious, but a lot can be hiding in the nitty-gritty details. Take, for instance, the electronics retailer Best Buy. For purchases from Oct. 28 to Dec. 28, Best Buy expands its paltry 15-day return policy to a fixed date of January 12, 2019 for most items (with longer periods for Best Buy Elite and Elite Plus members). But the return period for cell phones and anything else that has to be activated is just 14 days. And there are some items, including drones, DSLR cameras and lenses and electric scooters, that, if opened, are subject to the retailer's 15 percent restocking fee in most states.
When shopping online, another important thing to know is who must pay the shipping charges if you need to return a gift. With some retailers, if you got free shipping to begin with, you not only will have to pay the return-shipping charges, but the store also will deduct the cost of the initial free shipping from your refund. Also look at a retailer's policy on defective merchandise. Don't assume that a store will let you return defective items for a refund or replacement. Consider this language from the website LivingDirect: "We will not replace or exchange defective products that fall under the manufacturer's warranty coverage " Retailers should stand behind the products they sell, and in some states they legally cannot disclaim that responsibility, no matter what the fine print says. After all, you're giving your money to the store, not to the manufacturer, which may have separate obligations (more on that in a future post). Finally, some retailers don't allow returns of certain products, such as seasonal items or specific brands. So check.
DON'T blindly sign up for deferred interest offers. I recently devoted an entire post to this subject. The bottom line is that these deals, which let you buy today and pay over time interest-free, often are filled with gotchas that can end up costing you a lot. That's because the interest accrues during the interest-free period, often at double-digit rates. And if you're late with a payment or miss one, or if you haven't paid off the purchase amount by the due date, you'll typically be on the hook for the entire amount, including the interest. A recent study by the website WalletHub found that 82 percent of consumers don't understand how deferred interest programs work. And that's no surprise. WalletHub also found that many retailer websites poorly disclose the terms and conditions that apply to these deals.
DO make a gift budget. You've probably heard this before, and it sounds like a lot of work. But your friends and family don't want you going into debt for the holidays. Figure how out much you can spend, and keep track. Use a cell phone app, computer spreadsheet or just a pad and pen. And do a little planning to hold down the amount you spend. There are lots of gifts that make a big impression but don't cost much, maybe a nice bottle of maple syrup or olive oil, a gift basket of premium pasta and pasta sauces, or a pound or two of premium coffee (maybe add a mug or two). If you find you can't afford much, consider giving services that cost little or nothing. Make up a coupon that grandma can redeem to have you wash and detail her car. Or create one that your sister and brother-in-law can use to get you to babysit the kids. There are so many ideas that won't empty your wallet and that just might be the best gifts your friends and family receive this season!
DON'T give charitable donations as gifts. It sounds warm and fuzzy, but when you give a charitable donation in someone's name, that really isn't a gift to that person at all, especially if he or she didn't request it. And while your gift recipient might smile politely, inside they'll be saying "whatever," just like George Costanza's coworkers did in that Seinfeld episode in which his office "gifts" turned out to be donations to a very bogus "The Human Fund" charity. So save it for Festivus, and give a real gift instead. At least make sure that a donation is what your gifts recipients really want. And even then, it's best to hand over the money and let them make the donation directly. That way, they will get the benefit of any tax break (if you make the donation, the tax break goes to you). And who knows? They might just change their minds and quietly buy something they want or need.
DO give your gift recipient a receipt. Receipts often are needed for returning or exchanging an item and for making a warranty claim. Stores may allow for non-receipt returns, but your gift recipient likely will receive only the lowest recent selling price, not necessarily the amount you paid. Gift receipts are one option. They typically provide a store credit to the person making the return, not a refund. The actual store receipt may entitle them to cash. But if you used a credit card, the refund likely will go back to your card, not to your gift recipient. Of course, you always can return the item yourself.
DON'T open store charge accounts without careful consideration. Many retailers offer big savings to entice you to apply for their charge cards. It might be a one-time discount or an ongoing one that you get whenever you shop. But applying for one or more new lines of credit likely will ding your credit score temporarily. It probably won't reduce it much, but if you're planning to take out a mortgage or another type of loan any time soon, it could affect your interest rate. Similarly, if your car insurance is about to renew, you could end up with a bigger bill. That's because insurers often consider credit scores when issuing and renewing policies. So think before applying.
DO be careful about buying at popup stores. Unless the seller has a regular, permanent physical location or website, it could be difficult or impossible to return or excahnge an item, even if it's defective. So before buying, find out how you can go about contacting the seller to resolve any problems and whether there's a manufacturer's warranty on anything you buy. And of course use a credit card for the purchase.
