credit card – Life In A Word

Credit Guards (or AT&T pt. 2)

When my “favorite” service provider AT&T (tongue-clearly-in-cheek) challenged my creditworthiness last month amidst an adventurous request for internet service, I was forced to bow down before the Big Three. No, not Ford, Chrysler, Dodge – I don’t drive any of ’em. And not CBS, NBC, ABC either – I can now stream their programming (since I finally have internet). Rather, today’s big three are Equifax, Experian, TransUnion – those behind-the-curtains guards who man the credit rating tollbooths as sternly as passport checkers from former Eastern Bloc countries.

Credit guard companies are more difficult to deal with than credit card companies. The moment I entered college, offers for credit came pouring into my mailbox. I could qualify for ridiculous amounts on little plastic cards, even though I was a penniless freshman with little reportable income. But they want you hooked on credit at an early age so you’ll pay back a lifetime of fees in interest. Yet now, with decades of credit history under my belt (all of it positive, I say with muted pride), dealing with the credit guards is infinitely more challenging. It’s like walking up to Fort Knox and asking for a bar of gold.

If you don’t check (or even know) your credit score, you may not be familiar with the Big Three. They’re like triplets hired to do the same job: “consumer credit reporting agencies… collecting and aggregating information… on consumers and businesses worldwide”. Equifax tracks 800 million consumers. Experian tracks a billion. In other words, the next time you use your credit card, you can bet the Guards will be watching.

The Guards help themselves to your transaction, blend it with the others you’ve racked up recently, look at how well you manage your total credit and debt, and come up with a score. If you and your wallet behave, you get a number in the neighborhood of 700; if not, you’re closer to 500 (sounds like a college entrance exam, no?) 1.2% of Americans maintain an absolutely perfect credit score, though darned if I know how they do it. Maybe they pay for everything in cash.

Consumer credit reporting agencies are b-o-r-i-n-g (I’m surprised you’ve made it this far) so I’m not fired up to write about them today. Instead, let me tell you a story – humor at my expense, really – where the Guards were peripherally involved… and I was fired up.

When I was ~~battling~~ working with AT&T on my request for internet last month, the customer service rep stole took a full hour of my valuable time to ~~botch~~ set up the account, even though I already had another account with AT&T for wireless service. He asked a million questions (including the oft-scripted “how’s the weather where you are today?”). A marathon later – because I could’ve run one by this point – he said it was time to check my credit. Here’s where I should’ve thought to hang up because AT&T owns decades of credit history on me (thanks to the Guards). If AT&T couldn’t tap into my score already then maybe I shouldn’t be doing business with them. But I really wanted internet so I ~~surrendered~~ cooperated like a good little lamb, supplying my name, rank, and social security number. And this is where everything went horribly wrong.

“I’m sorry sir, but your credit is blocked.”

Blocked? What the *$%^#! HECK does that mean? When I asked him to please explain, my smooth operator countered by saying, “Let me run the check again. Repeat <your> social security number”… which I did, only to hear the word “blocked” again. When the third time wasn’t the charm he made a rather ~~stupid~~ bold announcement:

“I’m sorry sir, but you must have an invalid social security number.”

Invalid social? So you’re saying the nine-digit number I memorized when I was like, oh, an infant; the one I’ve spoken or written millions of times in my life, the one I’ve been trying to protect from identity thieves since I was born, is “invalid”? What kind of ~~incompetent fool~~ professional was I dealing with here?

Again I should’ve ~~slammed the phone down~~ hung up, but silly me, I surrendered more minutes of time to understand my “two options for service when I have blocked credit”. One, I could set up the account in my wife’s name. Involve an innocent bystander in this ~~circus~~ request and risk divorce? No way. Two, I could pay AT&T a $250 retainer fee to offset my newfound credit liability. Okay, NOW I’m insulted. When I declined both options, my ~~customer service imposter~~ temporary friend apologized, bid me good day, and hung up without another word. Seriously, he hung up on me (without so much as a sales pitch for DirecTV). I suppose you could call it a fitting conclusion to a totally worthless call.

My story does have a happy ending. Several days later I mustered the courage to call (A)nguish, (T)orment, & (T)orture again. Maybe the more you call them the better the service because the next rep let me know my credit was frozen (not “blocked”). Ah, now we’re getting somewhere! Frozen credit, for those of you in the not-know, is initiated by the consumer (me). A credit freeze is put in place to counter identity theft. I totally forgot I’d done that, like, last century, but thanks to a smidge of online access (the Guards are more hospitable these days) I was able to drop the freeze with just a few keystrokes. Bingo. Credit check passed. Internet service permitted.

The inspiration for this post was a recent headline about Equifax. The Guard issued millions of incorrect credit scores last spring, which meant consumers were either denied loans when they shouldn’t have been or charged higher-than-deserved interest rates. One ambitious soul is leading a class action lawsuit to reclaim the interest she never should’ve have paid. As for me, I choose not to deal with the Guards any more than I have to. After all, I get enough credit check grief from AT&T.

Some content sourced from Wikipedia, “the free encyclopedia”.

Heavy Metal

The most appealing aspect of my slim bi-fold wallet is – slipped into my front pocket – I sometimes forget it’s even there. Between the couple of credit cards, insurance cards, driver’s license, and the wallet itself, you’re talking about an item less than a half-inch thick, weighing just a couple ounces. That suits (pants?) me just fine, since I don’t want to be weighed down (or bulged) any more than I have to be. Maybe that’s why I don’t understand the fuss over trendy credit cards made of metal. Then again, my “vanity score” probably wouldn’t qualify me for one anyway.

I guess I missed the memo on metal credit cards. They’re in circulation to the tune of 32 million these days, which sounds impressive until you stack them up against the four billion plastic cards out there. Less than 1% of any total is never impressive, but the forecasters say metal cards will quadruple in the next two years. One reason for the increase: some financial institutions issue metal cards as a replacement for expiring plastic ones. Another reason: consumers are willing to pay an annual fee for the privilege of metal vs. plastic.

The demand for this sort of thing fascinates me. If my financial institution wants to gift me a metal card (whose hefty feel apparently makes me feel special and therefore inclined to spend more), so be it. Just don’t charge me an annual fee. Speaking of annual fees, here’s the extreme example with metal. A by-invitation-only American Express Centurion “Titanium” card will set you back $5,000/year, just so you can carry it in your wallet. You’ll also be tagged with a $10,000 initiation fee. I know several country clubs who’d let me in the door for less than that.

Honestly, I have no problem with holders of metal cards. Those same 32 million people probably pay for vanity license plates and gold-colored trim on their cars. They also pay to avoid standing in line, whether at the airport or at Disneyland. Maybe there should be a website to purchase “vanity fair” in one place. We could call it IFeelSpecial.com

Let’s get the drawbacks of metal cards out of the way up front. They’re high-maintenance. Apple has a titanium credit card, complete with care guide, which advises “… against keeping it in a pocket or bag with loose change… or other potentially abrasive objects”. Metal cards also demand a cleaning solution (like rubbing alcohol), though I suspect that’s more to make them look pretty than keep them charging. Finally, metal cards destroy your shredder if you try to get rid of them when they expire. Buy a pair of tin snips instead.

I’ll own up to having an American Express Platinum card and a Visa Platinum card, but both are plastic, and “Platinum” simply means they have a rewards program. Which brings me to a point of missed opportunity. If issuers are trending towards metal cards, why not make them out of whatever material they’re named for? A platinum card should be made of platinum. A titanium card titanium. Citibank’s Diamond Preferred card? Oooooooo.

It’s not the craziest idea. Metal cards weigh up to five grams. If Amex issued my Platinum card from five grams of pure platinum, they could charge me $600 (current market value). A Gold card made of gold would be worth almost $1,000. A Silver card made of silver? Okay, that’d only be worth eleven bucks. But think about it. Your card gets declined? No problem. Just surrender it and say, “I’d like the current market value in cash, please”.

[As usual, someone beat me to the punch with my great ideas. If you live in the Middle East, Singapore, or the Czech Republic, you have access to a company called CompoSecure. CompoSecure makes its credit cards out of pure gold.]

Counter to the forecasters, I think metal cards will be challenged by no cards at all. Meaning, pay-thru-phone (i.e. Apple Pay, Google Pay, Venmo) is on the rise, and the security of these transactions – not to mention no need to carry cards and cash – may trump the “special feelings” metal brings. Can you imagine – plunking down your country-club-rate Amex Titanium after dinner, and one of your guests goes, “Really? You still pay with a physical card? How old-school!”

Pretty sure I’m going to miss the metal credit card movement completely (even if they do make better ice-scrapers than plastic). I’ll be jumping straight from my plastic Amex Platinum to digital one of these days.

It would probably help if I set up Apple Pay on my iPhone first.

Some content sourced from the 12/5/2019 Wall Street Journal article, “Once a Tool of the Elite, Metal Credit Cards Now Turn Up Everywhere”.

Slipping Away

Every time we travel to California – this past weekend, for example – I have to be reminded about their statewide ban on single-use plastic carryout bags. You think I’d remember – Cali put the kibosh on the bags three years ago. Still, we fill our basket with groceries, head to the check-out, and the cashier goes, “want to purchase bags?” Argh. I should store a couple of reusables in my suitcase; the very ones I keep in my car in Colorado.

Plastic straws followed plastic bags, of course. Four months ago, the Golden State placed “discouragement” on the plastic variety (you must ask for them now). We sat down to a meal and our waitress brought glasses of water – with paper straws (argh again). Admittedly, “legal” sippers are pretty good. No reduction to mush like breakfast cereal sitting too long in milk. Other than the cost (several times more than plastic), and the fine ($25/day for un-requested plastic), paper straws are hardly inconvenient.

Now then, the real topic for today. California is looking to “strike up the ban” yet again – on paper receipts; the little critters we receive after credit card transactions. Say it isn’t so, West Coasters! Bags and straws I can deal with, but a ban on paper receipts? That’s just stealing another book from my old-school library.

According to a Wall Street Journal op-ed, the facts are these: paper receipts generate 686 million pounds of waste per year. (Can someone please quantify 686 million pounds – say, number of filled swimming pools?) Paper receipts also generate 12 billion pounds of carbon dioxide. (Again, quantify – number of breathing humans?) Also, paper receipts contain Bisphenol A (BPA); not exactly an appetizing compound. In other words, don’t eat your receipts just because the food was lousy.

Without paper receipts, my personal budget maintenance takes a blow. I keep everything in Quicken, so give me points for electronic accounting. But I also use paper receipts – an old-fashioned double-check mechanism. I enter the transaction from the receipt; then cross-check against the Visa statement (Jacob Marley reincarnated?) Why do I do this? Because once upon a time a waiter decided to triple my tip after I’d signed the bill and left the restaurant. Later, my paper receipt didn’t reconcile with my Visa statement. Busted. I promptly called the manager, who investigated and lo-and-behold, discovered a pattern of gouging. The waiter was fired. More points for me!

Now here’s the irony in my triple-the-tip story. What if the restaurant didn’t use paper receipts? What if I processed my transaction through Square or an iPad, self-swiping my card and choosing the percentage tip? For starters (and finishers) there wouldn’t have been gouging because there wouldn’t have been a waiter. It would be like standing over the shoulder of the processor at Visa – instant reconciliation. In effect, my story is a vote for no paper receipts.

Truth be told, I’m already evolving – slowly – from paper receipts. When given the choice (Home Depot comes to mind), I select “email receipt” or “no receipt” more often than “paper”. Unlike robo-calls, I accept the unsolicited side effects of electronic commerce (i.e. email spam). In a nod to maintaining control, I select self-check-in at airports and self-check-out at markets.

More likely, I’m caving on paper receipts because I’ve already done so with a laundry list of other paper products. My written letters have (d)evolved into email. My paper-printed books have dissolved into bits/bytes on my Kindle e-reader. My to-do lists now reside in a phone app. Bills arrive in my online inbox instead of my streetside mailbox.

Phil Dyer, one reader of the Wall Street Journal piece, commented, “California will soon attempt to regulate earthquakes”. 49 of 50 U.S. states just LOL’d. Me, not so much. After all, I never thought I’d see the day where I’d give up my paper receipts.

Cashing Out

Yesterday I picked up a few items for my mother-in-law, who seems to restrict her driving to the nearby grocery store. After dropping off the purchases at her house, I was reimbursed – rounding up – with a crisp, new, twenty-dollar bill. That bill went straight into my wallet, nestled alongside a couple of paper receipts. But on the drive home I thought to myself, “What am I going to do with twenty dollars?” Not the money, mind you – the bill.

For many of us, this is what it’s come to: cash is a nuisance instead of a convenience. Use that twenty-dollar bill for a purchase and what do you get in return? “Change” – more bills than you had in the first place (and a few of those little round coin thingy’s). It’s the modern-day definition of “cash flow problem”. The coins go into the car “ashtray” (what’s that?) to gather dust. The bills go into the wallet or purse, where they take up more real estate than they deserve.

Speaking of wallets, the contents of mine have been reduced to a driver’s license, two credit cards, a bank card, and a (paper) insurance card. Even if my wallet had a “billfold” pocket, there wouldn’t be anything in it. You could say I choose to be strapped for cash. Instead, my phone slowly absorbs my wallet: payment apps, photos, and ID cards; all formerly parked behind the leather inside my front pants pocket.

Of course, I’m not alone. As the table suggests (from the Wall Street Journal article Should We Move To a Mostly Cashless Society?) we’re using other means to defray our expenses. Cash and checks, please step aside for the more popular debit, credit, and electronic alternatives. Note the table is already three years old, so it’s safe to say “Electronic” is an even taller column today. I know it’s been years since my kids wrote a check (if they ever did). Their data-driven world prefers Venmo, Apple and Google Pay, PayPal, and the like.

How about a couple of surveys to support the cash-is-no-longer-king society we live in? The first – 2,000 respondents (smartphone owners) – says they conduct more transactions with their phone than they do with their cash. The second claims four in ten merchants will soon take payment through “digital wallet” apps (if they don’t already). Stack and rack those bills, people; cash is officially old-school.

One more data-point for you. This survey shows how much (or how little) cash we carry around these days. The age range of the 2,000 respondents is 19-71. I’ll bet my $20 the 71-year-old’s lean toward the yellow ($21-$50) while the phone-gripping teens lean toward the blue ($10 or less). Frankly, I think there should be a fourth color for $0.

In defense of greenbacks, I still come up with two reasons why I occasionally need cash on hand. The first: tips for on-the-spot services (i.e. rental car shuttles). Perhaps one day Avis will include tipping in its app – like Starbucks does – but for now it’s still gotta be cash. The second reason: the needy – spontaneous gifting for those street-corner-dwellers (especially this time of year). Without cash, I’ve got nothing to give.

No surprise, both of my reasons are included in the article 7 Reasons You’ll Always Need Cash The other five? Small-business purchases (i.e. farmer’s markets or lemonade stands); “managing a tight budget” (more of a strategy than a reason); “when technology fails” (which admittedly, happens now and then); “when you need to remain anonymous” (witness protection program, anyone?), and “in case of emergency” (in other words, buying yourself out of a problem). I choose to play the odds, as I don’t pass enough lemonade stands or find myself in enough compromising situations to merit a $20 in my wallet. I can still run pretty fast.

Speaking of my mom-in-law’s $20, I shifted the bill from my wallet to my wife’s purse as soon as I walked in the door. It wasn’t a reflex move (I swear). It’s just, my wife “bucks” the trend – ha – and prefers a “stash” of cash at her fingertips (or maybe under the mattress? I should go check.) In other words, if you’re looking for a handout, you know who to go to in this relationship. As for me, I’ve officially cashed out.

Steal a Card, Any Card

Imagine a carefree Saturday at the mall. You’re shopping with friends for something you really need, or maybe it’s just a little retail therapy. Whatever the reason, the shopping and the purchases make for an enjoyable afternoon. In fact, you’re so satisfied you decide to add on dinner afterwards at a nearby restaurant. All in all a great day, until you wake up the next morning and discover a fraudulent purchase on your credit card. Even more disturbing, you realize the waiter at the restaurant was the odds-on criminal.

My mall story is not hypothetical but actual. My family and I went shopping last weekend, and within twenty-four hours of our purchases we were victims of credit card fraud. What is most aggravating to me is the basic chain of events that points to the nefarious waiter at the restaurant where we dined. Why him? Out of a dozen purchases that day, the restaurant was the only location where the credit card transaction took place out of my sight. Instead of the several point-of-sale mall transactions, the restaurant – as is typical – carried my card away alongside the bill, to be processed somewhere out of sight. Also, the fraudulent purchase the following day was made at the department store adjacent to the restaurant. It’s an easy-as-pie theory on what went down.

My experience begs the question: why do credit card companies include all of the critical information right on the card? Write down (or phone-photo) the name of the cardholder, the sixteen-digit card number, the expiration date of the card, and the three-digit “Card Verification Value” (CVV), and you’re all set to assume the purchasing identity of someone else.

Google Authenticator, which sends a verification code to your phone that is required for login to certain apps, creates a secondary level of security that would significantly decrease credit card fraud. At the least, cardholders should be given a piece of data separate from what is printed on the card, so only they have every last piece of the purchasing puzzle.

Fortunately, credit card fraud is an inconvenience instead of an unexpected financial setback. My bank simply reimburses the amount in dispute, cancels the card, and issues me a new one. I can live with that (unless I owned the credit card company). What I can’t live with is the thieves who work the system. Thus did I send a note to the restaurant manager. I did not directly accuse the waiter as I really have no proof. But I did provide enough detail that perhaps the manager will track the activities of his employees a little closer. My hope is that he discovers the criminal among his otherwise trustworthy staff.