You've watched enough Tarantino to know you should only bring a knife to a gunfight if you're Uma Thurman. Bringing a debit card to a bar is like the proverbial knife at a gunfight: a shoot-ready script for getting killed by the bill.
Bar = party, but you don't want to run up debt and wreck your credit, so you make a conscious effort to use a debit card. For most of us, cash and debit cards are pretty synonymous. Maybe your phone case doubles as a wallet. Even a modest amount of cash is bulky for today's skinny jeans pockets, and if it falls out it's gone for good. Want a free drink from that tattoo-sleeved bartender? It's not going to happen if you hand him or her sweat-damp legal tender that's been stored in your sock.
But if you think you're protected from losing cash by using a debit card, perhaps you need to rethink your definition of protection. Debit cards get scammed the same as credit cards, but that's where the similarity ends.
A credit card is borrowed money, so when a fraudster runs up a big bill, other than dealing with a few hassles, the financial hit isn't as immediate as it would be with your bank account - especially if you report it ASAP. Yeah, you have to call the bank and get a new card (don't forget to notify other creditors that your billing information has changed), but you're only liable for up to $50 associated with whatever fraudulent use occurs, and most companies have adopted a zero liability policy. With debit cards, the story's a little different: Fail to report fraudulent activity on your debit card (or cash disappearing from your bank account) within 48 hours and you're liable for up to $50, but miss it entirely during a 60-day period, and you could be on the hook for $500 (or maybe the entire missing amount).
If your debit card gets hit, there goes much, if not all, of your available cash. Say goodbye to your decaf double cap.
While banks are typically required to get your money back to you within 10 days of a fraudulent attack on your bank account, and some companies like Visa and Mastercard have a policy of getting it back to you in five days, that's not going to do you much good if you're not accustomed to carrying large amounts of cash and someone empties out your checking account. Landlords won't understand. Grocery stores don't care. No Powerball tickets for you. So the best course of action here is to leave the debit card in your wallet.
Not convinced? Here are some more reasons to leave that debit card out of your adventures in bar-land:
1. A Dishonest Bartender
That bartender may not be working at a bar to pay for seminary training. In fact, he or she, or the bar back, may be a criminal. If you open a tab, your debit card (aka your checking account) will be out of your purse or wallet -- and in their custody -- for hours. It will reside by the cash register where there are pens and paper and plenty of time for some mean-spirited thief to write down your card information in preparation for a late-night shopping spree.
2. ATM Fees
Even if you decide to forgo the use of your debit card to open a tab at the bar, you may decide to use the ATM machine conveniently located in that dark corner of the bar. I suggest you do this early in the evening when you will be more likely to notice the $3-$4 convenience fee. Get some cash at your bank before you go, and save that money for a can of PBR.
Another reason to forgo those bar ATMs is the dreaded skimmer -- a magnetic strip reader that criminals use to record your card information. You often won't see a skimmer device even in the light of day (if the fraudsters know what they're doing), but you definitely aren't going to see anything is amiss in a dark bar. Repeat after me: "I am going to a bank."
4. No Points
In today's swipe fee-limited environment, almost no debit cards offer rewards anymore, and the few that do have plans that are nowhere near as robust as the ones associated with most credit cards. Credit can be the same as cash, as long as you think of it as an advance on a payment to be made at the end of the month -- and a possible flight somewhere warm this winter.
Losing your line of credit or your available funds to a fraudster can set off a nightmarish chain reaction in your finances -- the sooner you can resolve the problem, the better. One of your best lines of defense upfront, whether it's your debit card or credit card, is checking your statements -- daily. If giving your statements a quick once-over every day sounds like too big of a commitment, consider the fact that trying to undo the damage from a criminal is way more tedious.
Your credit standing is also at risk -- from maxed-out limits, to missing payments because your bank account is empty -- so that's all the more reason to keep an eagle eye on things. Checking your credit reports for signs of fraud -- like accounts that don't belong to you -- and monitoring your credit scores for big, unexpected changes, also need to be a regular part of your routine. You're entitled to your credit reports for free every year, and you can monitor your credit scores every month for free through Credit.com.
Fraudsters feigned interest in lonely online romance seekers to rob victims of about $50 million last year.
Phony debt collection agencies have pressured victims into giving up millions of dollars. The Federal Trade Commission recently closed down two California-based companies with call centers in India after they defrauded Americans out of $5 million over the past two years.
Craigslist and eBay are a playground for scammers. Consumers have sent payments to places like Nigeria for items advertised online only to discover they have been scammed. Last year, Romanians pretending to be U.S. citizens put fake ads for pricey items on eBay and Craigslist, defrauding Americans out of more than $100 million.
Canadian police arrested a man who tried to take a $70,000 processing fee from an elderly Californian woman who believed she was going to win a $7.5 million lottery prize in April. More recently, eight Jamaican swindlers accused of duping Americans in lottery scams were also arrested.
Fake charity organizations come out of the woodwork to exploit the generosity of others, especially during times of disaster. Most recently, an organization that claims to help disabled veterans called Disabled Veterans National Foundation (DVNF) took millions of dollars from donors without spending the money on veterans.
Scammers targeting struggling homeowners have offered false services to help with mortgage settlements. Mortgage foreclosure scams have shot up 60 percent in 2012 as new federal programs for mortgages have provided avenues for fraudsters to exploit.
Scam complaints related to travelling surged right before spring break last year. Crooks defrauded grandparents out of money when their grandchildren were travelling abroad. The scammers, who find out about the travel plans from places like social media sites, pretend to be the grandchild asking for wire transfers on the phone. The scams have involved scammers pretending in an email to be a victim's travelling relative who has recently been mugged or has lost their passport.
Although there isn't much data on how often it occurs, food scams can pose a tremendous health risk. The chances of dilution and counterfeiting increase when food is imported from other countries, and some foods like fish and olive oil are particularly prone to adulteration.
Scammers have sold drugs to online consumers and then posed as government agents asking the buyers to pay money to avoid jail time. A Texas woman killed herself after being caught up in one of these drug schemes.
Credit card breaches allow fraudsters to make charges on other peoples' cards after getting a hold of numbers. Global Payments Inc., a third party payment processing service for MasterCard and Visa, made headlines in April for reporting that over a million card numbers had been compromised from their system, according to CNET.
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