Credit card fraud takes place in a variety of ways and has become more of an issue over the past few years. However, there are ways to protect you and your credit score.

Arif Halaby, President of Total Financial Solutions, Inc. and Darbe Nokes, the Credit Gal have teamed up to share advice that can help you prevent credit card scams and protect you from incurring debt in retirement.

In the past, two-cycle billing, also referred to as double-cycle billing, was one of the biggest c legal “credit card scams”. When this occurred, card balances started increasing, because credit card companies were applying interest charges to two full cycles of card charges, rather than just the current period’s interest charges.  Credit card balances continued to escalate, but the average card holder could not figure out why.

Don’t miss a thing. Get breaking Santa Clarita news alerts delivered right to your inbox.

“Let’s say in January, if you’re charged $1,000, and you payed it off. Zero interest. February comes, and you’re charged $1,500. You still pay off $1,000, because you’re going to pay off the rest the next month. When you receive your March statement, you will be charged interest on not just the $500 you have left, but also on everything you have charged for the past two cycles or months, so you have a $500 balance, but interest for $2,500,” said Halaby.

After people started realizing what was happening, they decided to speak up. The Credit Card Act of 2009 effectively banned two-cycle billing. One problem involving credit cards may have been solved, but nowadays, common credit card scams prey on the elderly, specifically through the use of targeted emails.

“I’ve received those e-mails. [The scam artists] have taken my friends’ e-mail address [and then send me messages] saying ‘I’m in Brazil, and I’m stranded. I need you to wire money right away so I can get home. If you help me, I will give you more money when I get home,’” said Nokes.

Related: Credit Gal With Darbe Nokes Articles

More recently, even obituaries have been tied, unwittingly, to many credit scams. Scam artists use obituaries to obtain information about the person’s interests and job history.  Scam artists will even go as far to pretend to be a relative to their lost loved ones or even act as if they are their grandchildren, all to ultimately steal money!

“These guys keep a record of [the deceased’s information]. Then they show up at the house… and the relationship begins. Other times, they’ll give the house a call and say ‘Grandma, I’m stuck in Mexico… I need you to send money to Western Union,’” said Halaby.

During the show, Halaby provided a couple of major points to consider to avoid falling victim of credit card scams and of debt in retirement. One that he specifically highlighted was for travelers to bring three credit cards with with them when traveling to a foreign country to avoid surprise holds on their credit card.

“When you travel and take a credit card with you, consider taking three.  If you use your credit card for a hotel stay, they usually block out $500 or $700 or more, depending on how long you’re staying there. When you check out, there’s as much as a three day hold.  If you’re going to go to another hotel or check out a rental car, you can’t! Those dollars are blocked. It eats up your credit availability for days. So you will be leapfrogging between the credit cards as the three-day cycles release the available credit,” said Halaby.

Something to consider before traveling: Call your credit card company and let them know you are traveling.  Give them information on where you’re going, for how long, and how much you’re expecting to spend. Credit cards have tracking ability and protection that cash and debit cards may not.

Do you have a news tip? Call us at (661) 298-1220, or drop us a line at community@hometownstation.com.

Related: Credit Gal with Darbe Nokes Podcasts

Another key topic of this week’s radio show was the importance of having financial literacy to help prevent debt in retirement.

Halaby explained “The companies that you work for—if there is a retirement account—they are required to provide a level of financial literacy that meets IRS guidelines.”

So don’t let different numbers and names fool you and remember financial literacy does not only apply to adults. We need to educate our youth to achieve their financial potential. Nokes’ company, “The Credit Gal” has program called the Youth Financial Literacy Foundation (YFL).

The YFL goes to classrooms around the country and offers grade schools and middle schools $500 if they complete the eight-week in-home program, and they even throw the participants a pizza party!

 “We educate youth between 8 and 18 years old on personal finance. Hopefully by the time they arrive at the corporation level and land the job, they’ve already been educated,” said Nokes.

[node:title]

Article: [node:title]
Source: Santa Clarita News
Author: [node:author]