We rarely pay for expensive items when we are internet shopping. Most of our charges are under $75 for items like books or donations to support various nieces and nephews in fundraising projects. Other charges, like community college continuing education courses and parks and recreation lessons are usually under $250. We decided to reduce the risk of someone stealing our credit card information by getting and using a low limit credit card for our online purchases.
Why Risk Having to Cancel Your Long Held, High Limit Credit Card?
Like many people who’ve been working for years, we have a credit card that dates back over a decade. It has a high limit because it is used to pay for business travel expenses. (We only get reimbursed by our employer after we personally pay our bills.) It’s handy to have a large limit available in case of a sudden emergency as well. Much of our emergency savings are held in ways that would take up to 5 business days to access them. The credit card could help us during that interval.
If we used this credit card for online purchases and its information was stolen, a thief could rack up over ten thousand dollars of charges without having the transaction rejected. That’s too much risk for our taste.
If You Have a High Credit Limit Card It’s Easy to Get a Low Limit Card
The solution was simple. We applied for another credit card from the other major issuer. We asked for a low limit on the card of under $1000. We keep a list of what we’ve spent on the card. If either of us makes a large purchase, we can just pay down the balance immediately without waiting for the bill. That keeps several hundred dollars of credit available at all times.
We did telephone the credit card issuer and gave clear instructions that we do not want the credit limit increased without permission from us in writing in advance.
Cancelling a Low Limit Card Is not a Major Problem
If we did have trouble with this low limit credit card, we wouldn’t have any worries or regrets about having to abruptly cancel it. Our business needs would still be easily met with our other, higher limit card. A delay of a few days waiting for a new card would also be fine.
Conclusion
Having a low limit credit card for online donations and shopping works for us.
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Do you use one credit card for all your shopping online and in person? Have you any backup plan for if the card gets stolen or compromised? Please share your views with a comment.
Because of credit card regulations, I think they’re a lot safer to use than debit. I would be terrified to use debit online!
I think that they are both inherently risky. The greatest risk, though, is in being a small business. When a customer disputes a transaction it is usually the small business who is out the money/value of the goods sold. It’s not usually the credit card company left on the hook.