Monthly Archives: July 2015

Back-to-School Shopping on a Budget

It’s hard to believe summer vacation is coming to a close and the beginning of the new school year is just around the bend.

Some kids dread the end of summer vacation while others happily anticipate the first day of school. Both, however, want to start the new school year looking their best and armed with the required school supplies. And this can put additional financial strain on many families’ already stressed-out wallets.

So, here are a few tips to keep your kids happy while saving your wallet from a complete meltdown.

1. Plan – Before you buy the first pair of jeans or notebook, make a list of what you need and estimate how much you can afford to spend overall – clothes and supplies. Make a realistic budget and explain to your children that you will only buy what’s on the list and within your budget.
2. Recycle from last year – Check your children’s closets for clothes they can still wear or their younger siblings can wear. In addition, have your kids help find school supplies around the house that were left over from last year or can be re-used this year, such as markers, pencils and binders.
3. Watch for promotions, in-store and online coupons – Comparison shop. Many stores will match a competitor’s ad or coupon. If you’re purchasing online, make sure to check the cost of shipping and include that in your budget. Look for online retailers that offer free back-to-school shipping.
4. Postpone some purchases – Don’t buy everything in one fell swoop. Spread out your purchases. Retailers typically offer sweeter deals after the back-to-school rush. Review your children’s school supply list – if there are some items on the list that won’t be needed right away, hold off buying them now while keeping your eyes peeled for sales.
5. Be frugal – Consider thrift stores, outlet malls, and discount and consignment stores to get better deals on new and gently used clothing. If school uniforms are required, find out if the school has a trading or discount program.
6. Get Creative – If you’re not planning to hand your child’s clothes down to younger siblings, sell them (gently used and in good condition) and use the money to purchase back-to-school clothes or supplies. Consider doing a clothing swap with your friends who have children.
7. Get family members in on the act – When grandparents and other family members ask what they can buy your kids for their birthdays or other holidays, encourage them to buy school clothing or clothing gift cards.
8. Involve your kids – Back-to-school shopping is a great way to teach your children about budgeting and money management. Have them make their own back-to-school lists and put them in charge of finding coupons or the best deals on these items to stay on budget. Help your kids to understand the difference between wants and needs.

With these tips in mind, make this practical back-to-school approach an annual tradition. Shop wisely and find novel ways to stretch your dollar. Above all, remember that you are the parent so take control, stay on budget and don’t let your kids dictate what you buy. Teach your children to be thrifty…they’ll thank you for it later.

The Chip Cards are Coming!

In a continual effort to reduce fraudulent credit card charges and increase security, the credit card companies are moving away from magnetic-stripe cards, which are easier to counterfeit, and towards the EMV chip card as soon as possible.

According to a recent report by Barclays, almost half of the world’s credit card fraud happens in the United States, even though only a quarter of all credit card transactions occur here. This statistic, in addition to the Target and Neiman Marcus security breaches, are the major motivators behind the changeover.

In an attempt to reduce this statistic and future breaches in security, the EMV (Europay, MasterCard and Visa) chip card is already being rolled out across the U.S., and by October of 2015 merchants will be pretty much forced (see below) to upgrade their machines.

These cards, which have been status quo for in EU and Canada for several years, are manufactured with a small integrated circuit or chip in the card. Payment data (name, billing address, phone number, etc.) is read from this chip instead of the magnetic stripe. This chip protects against fraud in two ways: making it more difficult and expensive to counterfeit and varying the way the data is transmitted each time the card is read. Consequently, while the magnetic-stripe card can be skimmed easily, chip information will be much harder to garner.

Processing device providers are promising to make the transition for their customers (merchants) as flawless and cost-effective as possible. They are also working on several solutions for their Square Stand customers.

Chip cards will not be swiped in the same way as the magnetic-stripe cards, hence the new processing equipment. The cards are inserted into the payment device and left in place for the entire transaction as the reader and the card talk back and forth.

Although this new measure goes a long way to thwart fraud, it will not provide any added protection against the card-not-present transaction, i.e. purchases online or over the phone.

Even though merchants will have the option of using their current processing technology because the new chip cards will still have the magnetic stripe as a backup, starting in October 2015, the liability for fraud will shift to the cardholder and the merchant. In other words, since the EMV terminal could have theoretically prevented the fraud, the liability now falls on the user (the customer) and the processor (the merchant/business).

The timeline for the EMV Chip Card Liability Shift in the U.S.

October 1, 2015 – Visa, MasterCard, American Express and Discover liability shift to POS terminals.

October 1, 2016 – MasterCard liability shift for ATMs.

October 1, 2017 – Visa, MasterCard, American Express and Discover liability shift to pay-at-pump gas stations, as well as for Visa and American Express at ATMs.