How to save time due to credit card fraud

Credit card fraud continues to be a huge problem, despite the introduction of chip enabled credit cards in the US.

Twice during the past year I have had to replace credit cards, as the accounts/cards were fraudulently used. One of my sisters had one of her credit cards fraudulently used in the red card 01-28-16past two weeks.

Until chip technology acceptance at retailers and stores becomes much more commonplace, credit card fraud will continue. There is not much we can do to prevent this type of fraud as we shop at stores and eat out at restaurants, especially ones that do not yet accept chip-card technology.

One of the major hassles of having your credit card hacked is dealing with recurring payments that you have set up with that credit card. After a credit card hack, you have to log into each of the company websites that you have established for recurring payments, to give them the new credit card number, as well as the new expiration date and sometimes the security code.

Our recommendation: You should have a separate credit card just for recurring charges, such as utilities, subscriptions, iTunes, internet, cable, cell phone providers and more.

The purpose of this strategy is that for the credit card that you use for recurring payments, you should NEVER take or use that card outside of your home. Do not use it at a gas station, a retail store or restaurant. To re-use an old advertisement….don’t leave home with it.

This will be your “recurring payment only” credit card.

Doing this is the best way that you can prevent this credit card from being hacked, as most credit card fraud happens from the retail use of credit cards, not from establishing recurring payments through the card from credible companies.

This may be a major change in how you use your credit cards, but it will save you lots of time if another of your credit cards is fraudulently used and you need to get a new card account established. Hopefully, by adopting this strategy, getting a new card will just affect you for a few days, until you get a replacement card. It should prevent you from having to change all your recurring payment information.

Other credit card related recommendations and thoughts:

  • Use chip-enabled credit cards wherever possible.  If your credit cards do not yet have chips, contact your card company and tell them you want one.
    • Thank smaller retailers and establishments that have obtained chip-enabled credit card readers, as they are expensive.
  • You should review your credit card activity online regularly.  I suggest at least weekly.
  • At a minimum, carefully review your credit card statements at the end of every billing period to make sure all the charges are legitimate.
  • You should consider setting credit card alerts, so you will receive a text message or email if charges exceed a certain amount.  The problem with this recommendation is that most fraudulent activity starts with minimal charges, or around $100 or $200.  Thus, getting frequent email alerts on your regularly used credit cards maybe very cumbersome.  This will not prevent fraudulent activity, but help you identify it quicker.
  • The most common places that fraudulent charges are made, if your account is ‘hacked” are places like Home Depot, Best Buy, Lowes and in the Midwet, Meijer’s.  This does not mean you should not shop at these locations.  These are the places that people who do the fraudulent activity go first, when they start to shop with stolen credit card numbers.  These are the charges you should look for in your card activity.
  • You should provide to each of your credit card companies your email address and cell phone number, so they can contact you if they identify what appears to be unusual activity.  Again, this will not prevent fraud, but may stop it faster.


Link of the week: To learn much more about the benefits of using credit cards to obtain the most reward dollars, points and other perks, as well as airline and hotel loyalty programs and their credit cards, I recommend reading or following “The Points Guy” at or @thepointsguy on Twitter. The benefits can be worth thousands of dollars per year, if done strategically.
Thanks to my family members, who provided some of the above suggestions.

How to react to change

With worldwide stock markets continuing to be very volatile and most broad stock market averages down by approximately 8-12% as of the close on Thursday, January 21, 2016, I thought further commentary would be helpful to our clients and friends.

The cause of this quick decline can be traced to two sources: the slowing of the Chinese economy (their economy is still growing, but at a reduced pace) and the continued rapid decline in the price of oil and other commodities.

As I read and observe from many news sources, newspapers and other media, I want to provide my current thoughts about these developments. One benefit of writing this weekly blog is that it forces me to put my thoughts down on paper, so to speak, to reflect and think.

For our clients, as I stated in my blog post dated January 7, 2016, Our perspective on 2016, week 1, we do not feel that you should sell stocks or make major asset allocation changes to your portfolio, in response to these market declines. Significant changes to your portfolio should be prompted by changes in your life, not in reaction to declines in the markets. If the recent market activity is causing you to worry a lot or not sleep well, then we need to talk. Please call us.

In response to a question about whether someone should change their asset allocation now, Eduardo Repetto, Chief Investment Officer of Dimensional Fund Advisors (DFA) made a great point on January 13th, during a webinar. He said that your asset allocation decisions should be made before the risk shows up. What he means is that we work with you before investing your assets to develop the appropriate portfolio, and especially the mix between stocks (risk) and fixed income (what we refer to as the foundation), so that you can emotionally handle the volatile times. To get the benefit of investing in stocks, we know there will be up and down periods. That is why someone may only be invested 20% or 40% in stocks, because they may not have the need, timeframe or emotional ability to handle the short-term volatility. We want to determine the right mix for you before the down market arrives.

We want to encourage you to remain focused on your long term goals. This is key to you reaching your financial planning goals. Does the decline in the markets affect your ability to go on a vacation or take your kids out to dinner? Has it changed your behavior? Has the world really declined in value by 10%…permanently? We don’t think so.

The world-wide reaction appears overstated to the latest data on the Chinese economy slowing, which was announced just after New Years. However, the past teaches us that financial market movements can be swift, unpredictable and often tend to be either too negative or too positive.

The price of oil and other commodities have been heading downward since the summer of 2014. Many attribute the huge decline in oil prices to a reduction or slowing in demand, such as by the Chinese. The Chinese will be using more oil in the future, just the pace of growth is slowing. However, the supply side of oil is the bigger and more important long term trend. Innovation and technological advances, particularly due to shale and fracking, will cap future oil prices. Iran is re-entering the oil market. I was surprised to learn that global oil prices are affected by changes in production of 1-2 million barrels per day, even though daily production is in excess of 90 million barrels per day. From 2009-2014, US oil production increased by 4 million barrels per day.

While pain will be felt in certain parts of the US and in oil producing countries, we still feel that there will be significant longer term benefits to much lower oil prices. We don’t expect oil to return to $75/barrel or more anytime in the near term. They will likely go higher than today, but we don’t expect to see gas prices of $3.50-4 per gallon for a long time.

Remember, “this time is not different” than other market declines. The cause for declines may change. We never know exactly how or why they occur, or for how long they will continue to go down. But we do know that the declines are not permanent. We want you to remember that.
Was this helpful to you? Please let us know. Send me a quick Yes or No or other comments at I plan to discuss other financial planning topics in the next few weeks, but if market volatility continues, let me know if you would like me to write about the financial market activity.


Links of the week:

For further reading on these topics, please see the following articles, which I found very insightful. If you cannot access the links, please email me at

After the Carnage, Shale Will Rise Again, Mark P. Mills, Wall Street Journal, January 19, 2016

Markets are Scaring Themselves, Alan S. Blinder, Wall Street Journal, January 21, 2016

Do you have this?

“How easily do you bounce back from a disappointment?  What is your reaction to change?  As an investor, or a board member or an employee, are you seeking stability or impact?

“Resilience is a skill, one that’s probably more valuable than most.”

~ Excerpt from blog post by Set Godin, “Resilience, ” January 13, 2016


I can write about market forecasts, long term trends and all of those things, but when it comes down to it, Seth Godin’s message is critically important.

To be a successful investor, you need to be resilient.  Do you have this?

Being resilient means that you can overcome and bounce back after something bad has occurred. Resiliency means that you have the capacity to handle adversity, then recover, move forward and be more successful in the future.

While we provide you with investment advice, we can carl richards things matter mosthelp you be more resilient, especially during volatile times when stock markets are dropping.

Many times during the market downturn of 2008-2009, clients found that talking with us was helpful. These conversations made them more resilient.  And in the long run, this helped them to be more successful.

If you want to talk about what is going on in the world, or how it impacts you personally, please call us. That’s why we are here.

For more specific thoughts on recent stock market activity, please read our blog post “Our perspective on 2016, week 1,” dated January 8, 2016.

For a broader view, please read “Our most important advice, “ dated December 23, 2015.


Our perspective on 2016, week 1

Instead of starting out 2016 with beautiful financial fireworks, worldwide stock markets have begun the year with the equivalent of a Fourth of July firework dud which fizzles downward with a loud hissing sound of disappointment.

So what has occurred this week?

The primary cause of the stock market declines throughout the world this week was the continued contraction of the Chinese economy. Chinese manufacturing has been declining for 10 months, as opposed to previous years of rapid growth. The tracking index dropped from 48.6 to 48.2, where a number below 50 indicates a contracting economy. However, the December monthly decline in this index was less than 1%. Is the perception and reaction more than the real economic data?

The other major news of the week is the continued drop in oil and wholesale gasoline prices. Weakening Chinese demand for commodities and new data released on Wednesday showed US supplies of gasoline inventory increased unexpectedly, causing further concerns by financial traders. Retail gas prices at the pump are expected to decline further in the next week.

While dropping oil and gas prices are good for many companies and consumers, there are growing concerns about further job and exploration cutbacks by oil companies, as well as fears about whether smaller oil companies can survive at these much lower oil prices.

What do we think and what should you do?

Despite the significant Chinese stock market decline, which is greater than 10% in the first few days of 2016, US and broader global indexes are down much less than this amount through Thursday. At this point, the US S & P 500, defined below, is down around 5.0% for the first four trading days of 2016.

We recognize that the unexpected can and will occur. Unfortunately, these quick stock market moves are a reality. Volatility always has been, and will continue to be part of stock market investing in the future.

No one was predicting this decline just a week ago, before New Years Day. Just as we saw last August and in succeeding months, market declines can be recouped over a period of days or months.

We do not think you, our clients and friends, should panic and get out of the market. It is too hard to time the market correctly twice, to be able to get out and then try to perfectly time when to get back in the market before it rises again.

Remember, declines in the stock market are temporary, unless you sell and make it permanent. The volatility is ongoing, but its impact can be temporary.

The long term trend of global stock markets is clearly upward, particularly the longer you view it.While we recommend investing in a globally diversified portfolio, the following should help give you clarity and confidence to have a long term perspective in investing in the stock market.

These are the closing values in the S & P 500, an index of 500 large US based companies. Note that the companies within the index change over time.December 31, 1975: 90.19

December 31, 1985: 211.28

December 31, 1995: 615.93

December 31, 2005: 1,248.29

December 31, 2015: 2,043.94

For many investors, you should view declines as buying opportunities.

If you are young or are able to make IRA or defined benefit (for self employed individuals, like consultants) retirement contributions, make them now, not later in the year.

If you are older or retired, you should have an adequate financial foundation of investments like bonds and CDs, which you can rely on to deal with down financial markets. We work with our clients so they have many years of this type of financial security. If you have a strong foundation of safe fixed income investments, the volatility of the stock market should not impact your security or standard of living.

We hope this helps provide you with information and perspective. If you would like to discuss these recent events and how they impact your personal financial situation, please call us. This is an important way that we can be valuable to you.