Target. Home Depot. Michaels. Neiman Marcus.
What do these big store brands have in common?
Credit card data security breaches, the most famous killing Target’s Christmas last year.
For consumers it happens silently. They go shopping and swipe their cards. It doesn’t matter if they use a PIN code or merely sign for their purchase. The data breach is on the back end. Their information is usually stolen by Russian hackers who resell what they harvest from insecure retailers.
For 70 million shoppers last Christmas it meant seeing bogus charges on their bills during the busiest season of the year. It meant getting those cards replaced, fixing erroneous charges, and in some cases getting credit repaired. All Target could do was say “Sorry, here’s a coupon for free credit monitoring”. Merry Christmas, indeed.
What is a Christmas shopper to do?
Cash, baby. All cash.
Here are five reasons why cash is what’s for Christmas this year:
1. Cash has limits.
Using cash means you’ll spend less and shop smarter. It has limits more unforgiving than credit cards. There is only so much of it. Retail surveys will show that most Americans will spend about $700 on Christmas. If you know that now, why not earmark those funds in cash and dedicate yourself to keeping your expenditures below it? Your Christmas shopping, whether it is on food, gifts, decorations or entertainment, already just got cheaper because you know how much there is.
2. Cash is safe.
The department store credit departments and overall credit card companies are going to pump you full of promises over the next 12 weeks. “Use your card,” they will say. “It’s safer than cash plus we’ll warrantee what you buy.”
Buloney. Cash has no fine print, no shipping charges, no hoops to jump through. You get what you pay for.
As long as you have a receipt you have the same protections offered by a credit card. A credit card company will ALWAYS default to the manufacturer of a product before assuming responsibility themselves. By the time you get things resolved it could be Easter. Cash is an instant friend maker. If something doesn’t work out, just take it back and get the refund.
Some argue that carrying cash isn’t safe. Well, what are you buying? A car? There are more thieves lurking where you can’t see them than there are pick pockets at the mall.
And consider this: PF Chang’s, the famous China bistro folks, suffered a security breach this year too. Know what they are doing for credit card customers? Manual imprints. Think about that. They so distrust their electronic systems they would rather handle hard copies of all your information and expect you to walk away from their place of business with it in their hands. Not only is that insane, it is against the law.
Spend your cash and let the store worry about the security of it. You’re done.
3. Cash is the express line.
Cash is faster. All you need to know how to do is count. A credit card presents a world of options for a cashier at checkout. Cash is an in-and-out deal. Granted, most cashiers don’t know how to handle it well any more. But you’ll be there to guide them through it.
And because you’re spending less you’ll be faster.
But where cash really saves you time is if you have to return something. Cash requires fewer questions and fewer policies to decode. Read the return policy for just about any major retailer out there. Their first policy is usually their cash policy. If you spend cash at Christmas and bring it back, you’ll get cash back instantly as long as you have a receipt. There is almost nothing instant about a credit card refund.
4. Cash rewards are greater.
Credit card companies dangle the carrot of “rewards” for every dollar you spend. You can amass points that can in turn be cashed in for stuff. But points take a lot of time to acquire anything of value and, in the end, you’ve got a bill that comes every single month. Rewards take months of processing to receive.
Cash rewards you with instant gratification. Your transaction is complete. Paid for. You’re free to think of something else and there’s nothing to follow up on.
5. Pictures are for dead presidents.
Cash is anonymous. Nobody wants your photo ID, your signature, your fingerprint or an authorization code. Ever try to write a check at Costco? Talk about your hassle. A check transaction at Costco goes through more managers than buying a car. Just give them cash and everyone knows what to do.
You can expect online retailers to make a lot of hay about the security of purchasing through them online. Don’t be so quick to buy into it. We’re not in the prediction business but it is just a matter of time that you hear of a major breach of credit card data via an online retailer.
Online retailers have a clear advantage over retail stores. All their credit card information is usually stores in one place. A retailer will have credit card machines all over a stores and computers in every back office. Entry points for breaches are all over the place. But online retailers have some unique security hassles that retailers never have to face. Browser highjacks, phishing emails, and the “heartbleed” bug are all old problems not yet solved.
You can spend cash online. It takes a bit of work. Through pre-paid credit cards or online back accounts the transactions you’d normally make offline in cash are possible. But anything done online, whether cash or otherwise, is subject to the same concerns as any other digital transaction.
Does spending cash remove you from the deals to be found online? In some cases, yes. That’s just being honest here. But are those deals really deals after all? That would be up to you to decide.