Credit Cards or Smartphone Paying: Safer than Swiping?

Today’s burning question is whether you want to go with using your smartphone or stick with your old credit card. The debate is still raging from New York to LA. However, it is the wave of the future and it is best to find out more about what it is and whether or not you want to try to use it yourself.

America is already behind with the rest of the world that has embraced and switched to E-payment in a big way. China has gone almost entirely cashless as their new generation of Millennials shop almost exclusively using their cell phones.

Here in the States, however, we are still reluctant to let our money be controlled by a tiny NFC chip within our smartphones. The big promoter of this, of course, is Apple as they have included the special chip technology inside their latest generation of smartphone. Their only serious contender was Samsung and they have run into a brick on the road as their batteries have a tendency to explode in the new generation of smartphone they have just released. So, Apple has the infrastructure and clear sailing to take a large chunk of the market share while Samsung retools and retrenches.

But, what exactly will these chips do for us? The simplified answer is that just like your credit card you can walk up to any vendor, store, and even restaurants. You flash your cell phone, the transaction is completed all painlessly, and you don’t even have to take your wallet out of your purse, hip pocket, and backpack.

The greatest fear, of course, is the hacker. WikiLeaks has been bombarding us over the latest malfeasance of Hillary and the rest of the world. However, you have to remember these servers are running on Microsoft operating system, which is notorious for leaving loopholes and gaps in their coding.

Apple, on the other hand, is based on their iOS operating system, which is proprietary and one of the hardest to crack in the business.

Therefore, aside from the hardware aspect, Apple has invested a great deal of money in the infrastructure and the protection of their user database.

However, the one thing that I like the most, that has sold me on the idea, is the secondary authentication. For example, your credit card now requires a signature and away you go after making your purchase. The problem is people have gotten sloppy and with the “Swipe and Go” technology anybody can walk up with a card swipe and enter a pin number, walk away, and no one even checks to see if the card belongs to the person who’s using it.

Though the same is true of a smartphone people are quicker to react for some reason if they cannot put their hand on their cell phone. While sometimes, it takes days or even weeks for people to notice that they’ve misplaced a card.

Also getting into a smartphone is getting harder and harder than it is to peek over the shoulder of someone while someone is entering their pin number.

But, the bottom line that is driving the shift from credit card to a smartphone is simplicity and simple economics. Getting people instant gratification and streamlining credit card billing and payments along with saving all that wasted plastic going back and forth in the mail makes life so much easier.

So the handwriting is on the wall and the credit card will soon only be seen in museums and talked about as the woe of the middle class during the 90s, 2000s. Kids today, are not even sure what a credit card is anymore. After spending 20 years in the banking industry, it’s high time we put the credit card out to pasture.

Dora L signing off, until the next time, where I will offer you up another tidbit about managing your money and ways to keep more of it.

The Unglamorous Side of Homeownership

Personal finance is my forte and I have to remind you that it can pertain to the most sophisticated investments to the rather mundane. Part of family finance is to take care of the needs of one’s home and to allocate funds for repair and upkeep. I also counsel people not to procrastinate as it can result in a greater outlay of money when conditions deteriorate. Take my own problem: I had a dripping kitchen faucet and hesitated to hire an expensive plumber. I waited for a couple of weeks until the leak had grown to a virtual rush of unwanted water. I got on the phone in a jiffy. Of course, he fixed it in no time but he said the leak had caused the main pipe to corrode and now he had to replace it at considerable cost. I wish I had not waited. I hadn’t taken my own advice to handle broken household things promptly so they don’t cost more money in the long run. Homeownership is a big topic for my lecture series and it covers equity, mortgages, interest rates, and the like. But there is an unglamorous side of it to be sure. To mix things up a bit, I throw in a few stories like my kitchen faucet to make the point.

Any household budget can be taxed by home repairs and the older your home, the more likely you will encounter the need for on-going maintenance. Sure, we all wish we could buy new construction, but such is not the reality of real estate. There are holes in roofs, possible floods, and consequent mold. Your garage door stops working and the patio cover falls down. New carpet comes every five years as well as new kitchen appliances. Have you priced a good refrigerator or stove lately? You better set money aside. They say to replace your mattress every eight years, but it might be that long before the toilet conks out. It is fun to get upgraded things to make your home more attractive and comfortable, but don’t get blindsided. Start early to save for a rainy day as they say. Don’t ever wait for the last minute or you might have to come see me for a bank loan. I will be waiting to help.

Bank loans are not always easy to obtain but it is possible that they can be used for major home repairs. If you want to put an addition on to your home, replace the roof, or landscape the backyard, it runs into some significant money. But it adds value to the property when it comes time for resale, but it is also worth doing if a profit is your motive. Otherwise, a dilapidated fix-up home draws fewer buyers. Everything relates to everything else in the world of banking and personal finance. Get counseling if you feel at sea in this mysterious realm.