Don’t get caught up in check fraud

Check fraud has become an all-to-common method for criminals to profit, leaving innocent victims with big bills. As a result, the FBI has issued the following fraud alert.

If you can answer “yes” to any of the following questions, you could be involved in a fraud or about to be scammed:

• Is the check you are holding from an item you sold on the internet, such as a car, boat, jewelry, etc.?

• Is the amount of the check more than the item’s selling price?

• Did you receive the check via an overnight delivery service?

• Is the check connected to communicating with someone by e-mail?

• Is the check drawn on a business or individual account that is different from the person buying your item or product?

• Have you been informed that you were the winner of a lottery, such as Canadian, Australian, El Gordo or El Mundo, that you did not enter?

• Have you been instructed to wire, send or ship money, as soon as possible, to a large U.S. city or to another country, such as Canada, England or Nigeria?

• Have you been asked to pay money to receive a deposit from another country, such as Canada, England or Nigeria?

• Are you receiving a pay or a commission for facilitating money transfers through your account?

• Did you respond to an e-mail requesting you to confirm, update or provide your account information?

If you answered “yes” to any of these questions, tell your credit union branch personnel immediately. Always use caution when sending or accepting checks for goods and services solicited through the internet, e-mail or mail. Remember: If a deal sounds too good to be true, it probably is.

Educate tomorrow’s spenders early

It’s a common gripe among parents – “My kids never listen to me.” However, according to an article posted by Credit Union National Association (CUNA), many parents may be overlooking a prime opportunity to educate their children about finances.

CUNA reports that in a recent back-to-school survey, 87 percent of college students say they rely on their parents for financial information. But less than 30 percent say their parents have advised them about spending wisely. The percentage is even greater with high school students, with 90 percent saying they look to their parents for financial tips and guidance. And while these students say they look to their parents for financial wisdom, about 90 percent of high school students and 98 percent of college students say they have actually gained their financial knowledge from trial-and-error. “Learning the hard way” can set young adults up for unhealthy financial habits, or worse, leave them in a bad financial situation before they even get out on their own.

Part of the problem with parents being reluctant to discuss financial matters with their children is the challenge many adults have making ends meet, reports CUNA. Many parents surveyed admit that they do not set a good example in managing money themselves.

Parents should start teaching their children about money as early as preschool age. The earlier they begin, the easier it will be. In doing so, parents might find they improve their own financial education – as well as spending, saving and budgeting habits – while setting the trend for the future.

Electronic advantage: Utilize technology even if you don’t use a computer

Even if you don’t use a computer, you can enjoy the advantages of electronic transactions at your financial institution. Each time you elect an electronic transaction over a paper check, you save yourself time and money—plus you can reduce your exposure to forgery and mistakes. Electronic transactions save your financial institution the cost of physically processing checks. These savings come back to credit union member/owners in lower loan rates and more services.

When you set up automatic monthly payments for your car loan or mortgage, you save the cost of the stamp and envelope. Also, your payment is deducted on the due date, ensuring you won’t pay any late fees while leaving your money in your account through the very last minute—a plus if your account earns dividends.

Debit card transactions save you time and protect you against check forgery. Using a debit card to buy your groceries can save you time. You also eliminate the possibility that someone in the store can alter your payment amount.

An ATM/debit card gives you easy access to cash, but watch out for surcharges. A $1.50 surcharge for $20 in cash amounts to a 7.5 percent fee. Credit unions are known for keeping surcharges low, and many eliminate fees for member/owners. Getting cash from an ATM might be quicker than visiting a branch—plus ATMs are accessible 24 hours a day.

You’ll really appreciate the speed of direct deposit if you’re expecting an income tax refund. Direct deposit refunds arrive in half the time of paper refund checks.

Are electronic transactions safe? Yes. In fact, they can be safer than paper checks, which can be stolen or forged. Remember to record electronic transactions in your checkbook register, and confirm them when you balance your account.

Even if you don’t use a computer, financial institutions do, to correctly and efficiently process transactions. They use secure networks that encrypt or code personal information. Why not try out some of the electronic transaction opportunities that your financial institution offers? You’ll save yourself time and money in the process.

For more tips, click on the Anytime Advisor button on HCFCU’s website, www.hicommfcu.com, and benefit from Credit Union National Association’s enormous database of sound financial advice.

Credit quiz: Measure your credit card habits

Credit comes in several forms, from mortgages to credit cards. It is an agreement in which a person gets something now by promising to pay for it later, by paying interest on the borrowed amount. Used wisely, credit can help a person or business achieve goals. With secured credit, the borrower backs up his promise with something of value. For example, a credit union member/owner may take out a loan for a used truck. His credit union holds the title to the truck until the member pays back the loan. Credit cards operate a bit differently. Unlike a set monthly car payment, monthly credit card payments can vary based on the outstanding balance. Low minimum payments allow an individual to take three years to pay off last night’s dinner out—making it much more expensive. And high credit limits make it all too easy to slip into deep debt.

How do your credit habits stack up? Take this quiz to find out. For each question, make note of the phrase that best completes the sentence.

Q1: In the past three months, I’ve paid my bills on time…
a) All of the time
b) Most of the time
c) Sometimes

Q2: Each month, I usually pay about this much of the balance on my credit cards...
a) The entire balance
b) A fourth or more
c) The minimum payment

Q3: I use cash advances from one credit card to make payments on another card…
a) Never
b) Rarely
c) Sometimes

Q4: I buy groceries with a credit card because I’m short on cash…
a) Never
b) Rarely
c) Frequently

Q5: Before I buy on credit, I…
a) Ask myself how this purchase helps me achieve my goals
b) Promise to pay it off in a year or less
c) Check to see if I’m over my credit limit

Q6: I know about how much I owe…
a) Always
b) Usually
c) Rarely

Q7: I have enough cash in savings to weather most emergencies…
a) Yes
b) Not yet, but close
c) No

Q8: My spouse and I argue about money…
a) Rarely
b) Sometimes
c) Frequently

If you chose answer “A” most of the time, you’re doing a good job managing your credit.

If you chose answer “B” most of the time, some of your habits may have you heading for trouble. Pay attention to making more timely payments and accumulating unnecessary expenses so that you can reduce your debt.

If you chose answer “C” most of the time, you already know that credit is causing stress in your life. Now is the time to take some big steps toward gaining financial freedom from your credit cards.

For more tips and information on how to take control of your credit cards, click on the Anytime Advisor button on HCFCU’s website, www.hicommfcu.com, and benefit from Credit Union National Association’s enormous database of sound financial advice.