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”.

Hot Little Numbers

Yesterday, I became reacquainted with “hack” – a harsh bit of a word.  On the one hand, hack is when you take big chops into a tree with your ax.  Nothing wrong with that. Hack is also whether you can cope with a given situation (i.e. “can you hack it?”).  Nothing wrong with that either.  But then again, hack is uncontrollable coughing caused by a bad cold.  Or even worse, hack is breaking into a computer or account, with not-so-nice intentions.

I experienced not-so-nice hack yesterday.  My wife and I are waging war with a cold we’ve had since Easter.  Together we’re coughing up a storm (sounds of thunder).  More to the subject at hand, our bank left a tidy little message on our answering machine last night. “…do we have reason to suspect fraudulent charges on our Visa card?”  So, I logged onto our account and scrolled down to the last couple of days of activity.  There the little devils hid – six small charges, all for the food-delivery service “DoorDash“.

Have I ever used DoorDash? (No.) Do I even know what DoorDash is? (I do now.) I have no use for DoorDash, nor them for me.  We live in the country; wide, open spaces in every direction.  The only way we get pizza delivery is to agree to meet the driver halfway.  The only way we get trash service is to pay “fuel surcharges” on top of the monthly bill.  We’re too far out for DoorDash.  Just for grins, I entered our address into DoorDash’s website and up popped my options.  Cool!  For thirty days I get free service on delivery orders above $10.  Not cool – I have zero nearby restaurants offering DoorDash.  Guess its pizza for dinner again tonight.

Data Source: FTC Consumer Sentinel Network Data Book 2016

But I digress.  Back to the hack.  To my bank’s “credit”, they handle minor fraud efficiently.  They noticed the hack before I did (bless their computer algorithms).  Once I called back and denied any knowledge of DoorDash, they blocked my card and promptly dropped a new one into the mail.  A few days from now, I’ll be off and charging again, the only real inconvenience being to update my linked accounts.

I wish I could leave it at that.  After all, this incident won’t cost me a penny.  Those who pay annual fees and interest charges unknowingly pay the cost of credit card fraud as well ($40 billion every year).  I just can’t get past the fact someone out there enjoyed six free DoorDash deliveries courtesy of my credit.

The scammers are winning this game hands-down. A physical credit card allows crazy-easy access to its critical information.  Take your pick as you regularly surrender your data: 1) through your phone, 2) through your computer, 3) through self-service devices (i.e. gas pump, ATM), and 4) by simply handing over your card at a place of business.

Left: actual card slot. Right: Skimmer data-collection “cover”.

My DoorDash friend picked up my numbers through one of the last two ways – I’m sure of it.  I never give out my credit card over the phone, and the websites I use have some form of verifiable security.  Alas, self-service devices and handing over cards are no-win situations.  With the former, you encounter skimmers (discrete data-collection devices placed over card readers).  With the latter, you risk the merchant or waitstaff copying your numbers when out of sight.  They probably use a skimmer as well.

The only real solution to credit card fraud – sad to say – is not using the card at all.  Pay for your gas with cash.  Write a check for the cash you would’ve taken out of the ATM.  Technology is improving the situation (i.e. Apple Pay, table-side pay systems), but until these approaches become the norm, you’ll continue to deal with situations where your card goes out-of-sight.

Frankly, I’m not asking for much here.  All I want is my bank to collar my DoorDash friend and let me know he/she faces the consequences of their actions.  But I know my little scammer is not worth their time.  Instead, he/she keeps getting free food, and annual fees and interest rates tick up a little bit more.

My brand new Visa card arrives later in the week.  I’ll activate it and update my linked accounts.  The inconvenience to me amounts to less than thirty minutes.  But the annoyance of it all – well – that feeling lasts a whole lot longer.  I just hope, by the time DoorDash gets to my neighborhood, I’m no longer perturbed and willing to give it a try.

Hope they’ll take cash.

Some content sourced from the March 2019 Upgraded Points article, “The Best Ways to Prevent Credit Card Fraud & Theft”.

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.

Manipulation Games

In April of last year Starbucks modified its customer loyalty program, linking reward “stars” to dollars spent instead of store visits. Where previously you nabbed a free coffee for twelve trips to the cash register, you now need a total purchase value exceeding $63 .  According to CNN, “…customers were furious with the new program.”  Maybe so but those customers didn’t stay away either.  Starbucks’ 2016 gross sales were $21.3B, up 10% from its previous fiscal year.

Once upon a time I resisted customer rewards programs but over the years I’ve made peace with them.  I keep a couple dozen loyalty cards in the car or on my phone, ready to play whenever I visit this store or that restaurant.  I still control where, what, and how much I purchase.  Since I don’t keep a close eye on my rewards, I’m pleasantly surprised whenever I qualify for a freebie or a discount.

But here’s what I don’t like about rewards programs.  They’re designed to manipulate your spending habits.  That’s where Starbucks – like so many other merchants – gets a “fail” on my customer satisfaction test.  In addition to their stars program Starbucks sends emails every other day (which I unsubscribe from but always seem to return).  Those emails encourage me to purchase in certain ways or quantities or timeframes with the allure of “bonus” stars.  It’s a ruse; plain and simple and obvious.  No amount of “free” will ever tempt me to buy three breakfast sandwiches in five days.  Or three Frappuccino’s in three days.  (I don’ t even buy one breakfast sandwich or one Frappuccino.  Just coffee.)

Starbucks may annoy me with their sales tactics but I still buy their products.  The same cannot be said for credit card companies.  The newest Visa and MasterCard programs include sophisticated reward programs where spending is literally the only path out of debt.  Take Chase Bank’s Sapphire Reserve Visa card.  As trendy as this elegantly thin metal card appears to be, it’s utterly manipulative.  For starters, just holding the card in your hand sets you back $450 a year.  Then you’re encouraged to spend $4,000 in the first three months to qualify for 100,000 reward points (recently sliced to 50,000).  You’re also tempted by an instant $300 travel credit – which can only be used through Chase’s partners – as well as credits towards Global Entry, TSA Pre, and airline lounge fees.

No matter how you justify the rewards of Chase Sapphire Reserve you’re still spend-spend-a-spending to recoup the costs.  Consider Sapphire points are valued at 2.1 cents each.  The best-case scenario therefore – spending on travel or dining – still needs to add up to $15,000 before you’ve paid off the $450 annual fee.  Too rich for me.

Las Vegas is getting in on the rewards game too.  Sin City’s legendary “free drink” is about to enter the history books.  Slot machines now include small colored lights, easy to spot by the passing cocktail waitress.  If you’re “red” she’ll walk right past you without so much as a smile.  If you’re “green” you’ve fed your machine enough to earn a “free” drink.  The same goes for casino parking lots; spend enough inside the building and you’ll earn a voucher for outside.  Is it any wonder gambling is no longer the biggest source of revenue in Las Vegas (in favor of hotel, restaurant, and bar purchases)?

Despite these trends, I’ll keep playing the rewards game and very occasionally cashing in on anything “free”.  But I’ll also be wary of the subtle manipulations.  Just yesterday I received my umpteenth Southwest Airlines’ Visa card offer.  All I must do is spend $2,000 in three months for 50,000 points and no annual fee.  That application goes straight to the shredder every time.  My one and only Visa card with its no-frills-no-cost rewards program suits me just fine.