By now you should have completed your taxes and are most likely eagerly awaiting your return. While some will get just a couple hundred dollars back, some of you could be in for a fairly sizable cheque. It’s easy to get excited about unexpected money, and hard not to want to spend it all at once. Before it arrives, though, take some time to think about how you can best use that money. Here are 8 suggestions for ways you can spend your tax refund wisely:

1.    Pay off any outstanding bills

If you have outstanding bills, using your tax refund to pay them off is probably the best option for you. There’s nothing worse than the stress of being behind. Take this opportunity to get ahead of the game for once.

2.    Pay down your credit card debt

Credit card debt can build quickly, but it’s hard to whittle down once it mounts. If you have outstanding debt on your credit cards – debt that keeps you up at night – the responsible thing to do would be to put your tax return towards that debt. Of all the debt you have, credit card debt is most likely to have the highest interest rate running from 9 – 23 per cent. By paying that debt down first, you’ll actually be saving money in interest later.

3.    Put some of it towards your mortgage

If you have a mortgage that allows you to make additional payments without penalty (and most mortgages will allow you to make an annual lump sum payment of 5 – 25 per cent of the mortgage value), this might be the perfect opportunity to use that to your advantage. The more you pay now, the less you pay in interest later.  Check out how much money lump sum payments can save you with this Mortgage Calculator.

4.    Invest in your future

If you haven’t started an RRSP, maybe it’s time. Your return might not amount to much now, but over the years your investment will grow. This is a particularly good idea if you are feeling no other financial pressures at the moment.

5.    Start an emergency fund

Doesn’t it sometimes seem like bad things happen either when you’re least prepared or when you’re least able to cope? You just paid a huge vet bill and your washing machine suddenly dies. You finally paid off your credit card debt and your car breaks down. These situations happen all the time, and sometimes it feels like you’ll never get ahead. Without an emergency fund, situations like these can be stressful. Why not take this extra cash and set it aside for those little emergencies? When the time comes – and it will – you’ll be glad you did. 

6.    Upgrade your job skills

Have you recently found yourself wanting to return to school? Have you dreamt of taking courses to upgrade your skills? Will doing so help increase your salary? If you answered “yes” to any of these questions, you might want to consider using your return to invest in yourself. This is an especially good idea if it will help to boost your income in the long run.

7.    Treat yourself to something nice

Sometimes being responsible is all we do. If you’re one of those people who seems to always be doing the right thing – saving money, paying down bills, saying no when you really want to say yes – then maybe you need to do something nice for you. Buy yourself a new outfit. Go get your hair done. Take yourself out for a nice lunch. Go golfing. Spoiling yourself is sometimes the best course of action – especially if it’s something you don’t often do.

Alternatively, you could also treat someone else to something nice.  It might not be top on your list of things to do with your tax refund, but using some or all of that extra money to make a charitable donation could be more rewarding than a new pair of shoes.

8.    Go on vacation

Many Canadians use their returns to book their yearly vacation. Without their return, some wouldn’t even get a vacation. You don’t have to spend every waking hour worrying about your debt, retirement savings or credit card bills. You are allowed to let loose and have a little fun. Go ahead; use your return and treat yourself to some time away. You deserve it! 

I’d like to be able to give you a magic formula for how to best spend your tax return. Unfortunately, there isn’t one. Everybody deals with money differently. If you’re a person who pinches pennies all year round, then maybe this is the time to treat yourself to something nice. If you spend too much money and have a mountain of debt that stresses you out, maybe your return should be used to pay that debt down. You know yourself best. Make a list similar to the one above and prioritize. My personal advice is to put 50 per cent towards debt, 30 per cent towards savings and the rest towards a treat for yourself. But be honest and make the best decision for you.

According to the Canadian Bankers Association, Canadians collectively held 74.5 million Visa and MasterCard credit cards in 2011. Given that there are fewer than 27 million Canadians over the age of 20, that works out to nearly three per adult. And that’s just Visa and MasterCard cards. With millions of retail cards issued by stores like the Hudson’s Bay Company and The Brick and it’s no wonder our wallets are bulging, even if there’s no cash in them.

But how does this compare to others countries? And what are the implications of our addiction to credit?

Credit Card Usage in The U.S. of A.

It should come as no surprise that the citizens of the world’s largest debtor nation hold the highest number of credit cards per capita: one report calculated that there were 576 million credit cards in circulation in the country in 2010. Another tally estimated that the average American carries around six credit cards. At its peak in 2008, the collective U.S. credit card debt was just shy of $1 TRILLION dollars, at $957 billion. Today, the figure has dropped to just under a mere $800 billion. You don’t want to even imagine what the interest payment on that would be at 19 percent…

Credit Card Usage in Jolly Olde England

They’re similarly fond of using credit on the other side of the pond. With some 60 million cards in circulation (about one for every man, woman, and child), in a typical month U.K. residents make about 160 million credit cards purchases, at an average of £66 per swipe. Collectively, that helps add up to a tidy chunk of the country’s collective $1-trillion pound debt (a figure that includes government, corporate, and all other debts owed).

Credit Card Usage in The Land Down Under – Australia

Way round the other side of the world, the Australian credit card addiction is less severe, but still problematic for some residents. With about 14 million cards in circulation – about one per adult, in a country with a total population approaching 23 million – cumulative credit card debt is about $50 billion, a little more than $3,000 per cardholder.

Credit Cards Rights and Wrongs

So, regardless of where you live, what do all these mind-boggling numbers mean? Well, it depends on how you personally handle your own credit cards and the credit card debt you rack up.

There’s nothing inherently wrong with credit cards. In fact, used properly, they are a key tool in a savvy consumer’s tool-belt. If you pay your bill on time every month, you effectively get a no-interest loan on everything you purchased in the weeks leading up to the due date. And, in addition to rewards programs, many cards also include built-in perks like free travel insurance. Plus, they save you having to cart around hundreds or thousands of dollars in cash every time you need to make a big purchase, all the while growing your personal credit rating month by month.

The problems start when you don’t pay your bill in full each and every month. Whether you’ve signed up for a low-interest card, one that offers a standard 15-20 percent rate, or hold something that leans more towards highway robbery (the Canadian government doesn’t consider it loan sharking until rates exceed 60 percent annual interest), the interest fees are backdated to the date of purchase, even if you’ve paid off most of the bill. One penny short of what you owe earns you a full-sized interest penalty. Start falling behind on consecutive months and your debt can quickly spiral out of control.

If you do find yourself regularly missing payments and collecting hefty late-payment fees and other penalties, you might want to consider speaking with a credit councilor to see if they can help get you back on the path to financial stability.  Credit card debt denial is not a path you want to travel down.

When I’m at the checkout, I often open my wallet and pause for a moment, pondering how to pay. Cash? Nope, too hard to get that stuff, I’m saving it unless I’m buying a pack of gum.

So it’s often the debate between debit and credit card. The final tally, in many ways, is the same. I buy something, I have to pay for it, either now (debit) or later (credit).

But the decision is much more complex if you look at the bigger picture.

When Debit is Best

A debit card is the best way to pay for the majority of your purchases if you struggle with debt. If you’re one of these people, you should flat-out leave your credit card at home in a safe place and go debit. Or,  if money is a major issue, withdraw a set amount each month and pay for everything with cash to truly keep yourself in line.

Even if debt is not a serious monkey on your back, using your debit card for most of your purchases keeps you in a clean financial situation. You can check your bank accounts regularly online to be sure you don’t go into overdraft. When your account gets low, you stop spending and turn down that offer for a nice dinner out or resist hitting your favourite store until after the next payday.

Credit Card Perks

However, the modern world of credit cards has serious appeal. Now on the market are a slew of cards that allow you to build up points for travel, groceries, gas and more.

Cash-back cards are probably the most directly beneficial to those who want to leverage their credit card use for benefits. Almost all the major Canadian banks offer cash back Visas or MasterCards, many with no annual fee. The MBNA Smart Cash Credit Card offers up to 5% cash back on gas and groceries for the first 10 months, and then a very competitive 3% after that (all other purchases will get you 1% cash back). The Scotia Momentum Visa Infinite is another great cash back card, offering 4% cash back on gas and groceries, 2% cash back on recurring payments and drug store purchases, plus 1% on everything else.

As with all credit cards, read the fine print. Make sure redeeming your cash points is easy, and that some of the great offers (low interest, a higher percentage cash back) don’t expire after just a few months. And since most cards offer big points or cash for your first purchase, activate the thing at a good time, such as when you’re paying for a vacation or a big electronics buy.

Better Security

For me, since I have no rewards on my card, a credit card is ideally suited for those big purchases when I want a team at my back.

Many cards offer some insurance for your purchases (read the fine print of course). But even if your card does not, if you do buy say a large TV and it never works and the retailer gives you a hard time, you can go through your credit card company to get your money back. Remember, these retailers have accounts with your credit card company too, and they can be refused money or lose the account.

But cards with more features offer specific kinds of insurance for travel, purchases and more. Keep this in mind whenever you buy and don’t be afraid to call on your credit card company when things go wrong.

Another huge benefit is if you are the victim of a financial crime, you’re better off having that crime take place with your credit card. Card companies are amazing at not making you pay when there are iffy purchases from a card that’s physically stolen or your info is stolen.

Build Your Credit Rating

The best way to build your credit score, bar none, is to regularly use a credit card and pay it off every month. If you’re coming out of a bad credit situation, or you just don’t have any credit history, a credit card is where you want to put more purchases.

If you struggle to get approved for a card, you can build credit by applying for a store credit card or a secured credit card. Store credit cards can be easier to get and while they charge large interest rates, having such a card will allow you to build up your rating and eventually get accepted for a more traditional card (if you pay it off on time!).

As well, banks and credit card companies offer so-called secured credit cards. They allow you to put money down (say $500) and borrow off that deposit. Clearly, these aren’t as great to have as a regular card, but this type of card is a more popular and prudent way of building your credit worthiness.  They also allow you to do things like buy online or purchase airline tickets; two things that are somewhat impossible without a credit card. Check out products like the No-Fee Scotiabank Value Visa Card or the Capital One Low Rate Guaranteed Secured MasterCard.

The Debt Card versus Credit Card Debate is a Personal One

Wherever you go, it makes sense to have both your debit and credit cards on hand. But what you choose to use should be more about the reality of your money situation than the rewards behind the card.

Like most credit card users, I chose the cards I use based on both interest rate and rewards. I have three credit cards in total. One collects WestJet points, which I use to visit my family out west. The second collects rewards points that can be redeemed for grocery money or returned as cash. The last card just collects rewards points. I couldn’t tell you what kinds of rewards I can purchase, because the whole system is so confusing that I’ve given up using the card altogether.

I’d rather use one of the other two cards simply because they’re easy to calculate and are not limited to one type of reward. While I can redeem my points for something tangible (i.e. groceries), I can also choose the cash back option and use the money to pay off other debts. If my third credit card weren’t so darned confusing, I might use it more often, but that’s not the case. Besides, I don’t need another gift card or useless electronic device. If I want those things, I’ll just buy them.

Why More Users Are Choosing Cash Back Cards

According to Globe and Mail personal finance columnist Rob Carrick, I’m not alone. Credit card users are confused about rewards points and are therefore opting for more straightforward cards. In fact, more credit card users are choosing cards that offer cash back over rewards points. Whereas travel points are still the most attractive option, cash back cards are gaining momentum.

Mary-Anne Heustis, a principal with the research firm MarketSense Inc., confirms this. “Travel is still at the top of the list,” she says, “but what we’ve seen over the past couple of years is that cash back is really picking up momentum.” Heustis attributes this change to unnecessary confusion in the credit card industry.

“It’s partly because people are getting a little tired of the complexity of the travel category,” she says. “And, there are some very rich offers on the market right now.” By “rich offers,” she’s referring to cash-back credit cards.

Another reason cash-back cards are a more desirable option is because of their straightforwardness. People are getting tired of rule changes and lame options, says Carrick. I can vouch for the lame options part. When I went to finally went to use my WestJet points, I couldn’t book the flight online, which meant that I lost out on the sale price (it was only available to those who booked online). All of these little rules are annoying and keep me from using my card to its full extent.

RateSupermarket.ca Offers a Solution

All reward cards aren’t created equal. Depending on the card you choose, you’ll be offered rewards points, miles, or cash-back. But how do you know what you’re really getting? Which card offers the best deal? To help you determine the card that offers the highest rate of return, RateSupermarket.ca has come up with an interesting and unique solution to this problem – Your Reward Return.

By putting a number of typical reward items into one basket – electronics, gift cards, etc. – RateSupermarket.ca experts have developed a metric for putting all cards on a level playing field. When comparing their list of rewards credit cards currently on the market, be sure to check their Reward Return rating. It will help you compare apples with apples and make a better choice based on the return on your spend.

Two cards of note

Based on the Reward Return rating system, here are the top two cards currently on the market.

MBNA Smart Cash Credit Card

• Interest rate: 19.99%
• Balance transfer: 1.99% (for the first 10 months, 19.99% after)
• Annual fee: $0.00
• Cash advance: 19.99%
• Min. credit score: Good
• Reward Return: up to 5.00%

Special Offer: 5% cash back on gas and groceries for the first 6 months, receive 3% cash back afterwards and 1% cash back on all other purchases. The best part about this cash back offer is the redemption process – you’ll receive a cheque in the mail automatically once your cash back totals at least $50 per month. Plus, an introductory balance transfer rate of 1.99% for the first 10 months can help reduce your monthly interest payments on your outstanding credit card debt.  

Scotiabank’s Scotia Momentum VISA Infinite

• Interest rate: 19.99%
• Balance transfer: 1.99% (for the first 6 months and the 21.99% after that)
• Annual fee: $99
• Cash advance: 1.99% (for the first 6 months and the 21.99% after that)
• Min. credit score: Excellent
• Reward Return: up to 4.00%

Rewards on every purchase: 4% cash back on all eligible gas and grocery purchases, 2% cash back on recurring payments and drug store purchases, and 1% cash back on all other purchases. Plus, you’ll get VISA Infinite enhancements – a unique program of premium enhancements including VISA Infinite Complimentary Concierge and a dedicated VISA Infinite website to help you easily track your cash back rewards.

You’ve seen the credit card offers before: 0% interest on balance transfers, or transfer your outstanding credit card balance and get this great (insert gift incentive here).  So what’s the deal?  Why would those offers appeal to already cash strapped consumers?

Here are the top 2 reasons why you’d want a credit card with a low balance transfer rate.

1) You Need to Pay off Credit Card Debt

Say you have an outstanding credit card balance of $5,000 and you’re paying $19.99% interest on the card.  You’ve heard it before, if you just pay the minimum balance every month, it will take you over 25 years to pay it off and cost you $9,182.73 in interest!  Insane!

So now let’s say you have a plan in place to pay off your credit card debt this year and you’re able to make a fixed payment of $500 each month to get it under control.  With your current credit card, it will take you one year to pay off the total debt and cost you $514.93 in interest over the year.

If you switch to a card offering a low interest rate on balance transfers, say 0% (you can’t get much lower than that!), then it will only take you 10 months to pay off your debt and cost you NOTHING in interest.  That’s a savings of $514.93!  And that’s why low rate balance transfer cards can be wonderful.

But be warned, if your low rate has an expiry date (in this example, the 0% interest is offered for the first 10 months and then the rate increases to the standard 19.99% interest rate) then you need a plan to pay off the balance during that period to really take advantage of the benefits.

2) You Need a Short Term Loan

Say you plan on renovating the kitchen this summer or you want to invest in landscaping for the backyard.  If you put the cost of the work on your current credit card and then switch the balance to a low interest balance transfer card, then you essentially get a short term loan for peanuts.

Given that the going rate for a line of credit these days is roughly Prime +, you won’t get a loan for any lower than 3-4% interest.  But you could get a low interest balance transfer credit card and pay a rate of 0% – 2.99%.

Again, the caveat here is that you need to pay off the balance before any rate incentive expires.  So either plan to pay off the balance a little at a time or make sure you can pay the entire amount owing at the end of the offer period (here’s hoping for a Christmas bonus!).

So I’ve convinced you that getting a low interest balance transfer card is the way to go.  Which low interest balance transfer credit cards are the best in Canada?  Here are my top three picks…

MBNA Platinum Plus MasterCard

You can’t beat 0% interest.  The MBNA Platinum Plus Credit Card offers no annual fee and 0% interest on balance transfers for the first 10 months.  The perfect card if you want more of your money going towards paying off the principal instead of just the interest.

Plus the card also offers purchase protection and extended warranty.

Learn More: MBNA Platinum Plus MasterCard >

Capital One SmartLine Platinum MasterCard

Not only do you get 5.99% interest on balance transfers with the Capital One SmartLine Platinum MasterCard, but it also has the same low purchase interest rate.  The 5.99% offer is valid for the first 36 months, which gives you a bit more time to get your credit card debt under control.  After that it only increases to a reasonable 7.99% interest rate on purchases and balance transfers.  There is also no annual fee.

Learn More: Capital One SmartLine Platinum MasterCard >

Scotia Momentum Visa Card

For a small annual fee of $39.00, the Scotia Momentum Visa Card offers 1.99% interest on balance transfers for the first 6 months.  The rate then increases to 21.99%.  But the good thing about this card is that it also offers reward incentives on purchases.  You’ll get 2.00% cash back on gas and groceries and 1.00% on everything else. So you could start using it as your everyday credit card after you’ve paid off your debt.

Learn More: Scotia Momentum Visa Card >

We thought we’d go one step further in analyzing the poll results and have pulled together an infographic showing just how bad our credit card debt denial has become and exactly which provinces are ignoring the truth.

We hope you enjoy!

As much as we all like seeing the balance in our savings accounts grow, aside from having enough cash on hand to pay your bills and daily expenses, it almost always makes more sense to pay off your debts first. Here’s why – and a couple exceptions to that rule.

Pay off your costliest debt first

No matter what kind of debt you’re carrying, it’s always going to be substantially more expensive to borrow than what your bank offers you in savings account interest. Figuring out the order in which you should pay off your debts first is easy: pay them off in order of highest to lowest interest rates charged.

Typically, your credit cards are going to be your most expensive form of debt. Outside of short-term, introductory rates, most cards charge 20 to 30 percent interest. Of course you can find much better rates with a low interest credit card – but regardless of the percentage, interest charges on any unpaid balance are retroactive to the time of purchase.

Next up are car and student loans. Financial institutions are keen to extend these long-term, profitable loans to customers – and, with the latter, the hope that they become your home for future financial business – they generally offer them at rates a few points above prime. Once all your credit cards are fully paid up, pay down that student or car loan, again, focusing on the most-expensive one first.

In the clear so far? Great, now you can take a look at your line of credit. An unsecured line a of credit is going to be charged at a slightly higher rate than one that’s secured against collateral like you home.

Finally, if you’re fortunate enough to have all your other debts paid in full, then you should focus on making overpayments to your mortgage. Just make sure you don’t exceed the amount you’re entitled to – typically 20 percent of the principal per calendar year – but check your documents to make sure and to avoid any penalties.

The exception to the rule

When it comes time to apply for a mortgage, all your debt is going to count against you. (The banks will even add up all the credit limits on your cards to figure out how much potential debt you could accumulate.) But they’re also going to want to see some evidence that you have money available to make a down payment. First-time homebuyers can withdraw up to $25,000 from their RSPs (so $50K for a couple) through the federal Home Buyers’ Plan.

Otherwise, a mortgage lender is going to want to see bank statements or other investments showing that you have enough money available to make at least a minimal (five percent) down payment.

Also worth keeping in mind is that for every point below 25 percent your down payment you’ll pay an escalating rate of mortgage insurance. For more on that, see “The (Additional) Costs of Buying A Home.”

Emergency Preparedness

While only a crazy person would squirrel away their life savings in the proverbial mattress, it is wise to have some cash on hand for emergencies. Many people in Ontario were caught off-guard during the Great Blackout of 2003 when they discovered that none of the ATMs they relied on to access their bank accounts were working. At the same time, credit card systems were also down, so they found themselves in a temporary cash-only society. For a single person, $100 to $200 should be enough to tide you over for a couple days of crisis. If you have a family, consider how much money you’d need to feed and provide for everyone for 48 hours.

Long before every retailer, it seems, began offering points for purchases, there was AirMiles. This versatile rewards program was launched in 1992 and lets you rack up points when you buy stuff at a wide array of places — both in person and online — and redeem them for kitchen gadgets, event tickets and vacations. AirMiles points work on a points card, or as part of an AirMiles credit card program.

The system has worked for years for many people, but now the program has some new offerings. Here’s what’s up.

Cash Rewards

Under the new system, AirMiles lets you rack up points as a so-called cash balance. You can redeem your points and get money at retailers that collect AirMiles.

This is not that different from some of the points cards offered at retailers. For instance, at my grocery store, I’m often asked if I want to cash in my points and get $5 off my groceries. I almost always say yes: I’m too lazy to keep track of my points and redeem them myself.

Under this new program, you have to take an active role, however. You need to go online and let AirMiles know you’re interested in moving your points into cash.

The “Dream” Option

AirMiles still lets you collect points that you can redeem for travel and other things. They’re calling this the dream account now. When you go online to change your preferences, you’re telling AirMiles how many of your points you want to go into cash, and how many into dream. If you’re lazy like me, you might go for 100% cash. Or if you’ve had some good free purchases in the past you might want to keep everything in dream, or find a 50/50 balance. Totally up to you.

Take Action

What’s really different about this card now is you must take action to set up your preferences. (You can change them anytime if you change your mind, which is good news.) If you do nothing, all your points will go into the dream side, and you can keep redeeming your points for purchases.

As the points credit cards pile up in your wallet, best thing to do is make sure you’re getting the most out of the ones you have. (After all, these companies are collecting consumer data on you.) So take a moment to ditch the cards that do nothing for you and customize those, like AirMiles, that can give you perks that suit your spending habits.

Independent Survey Finds Credit Cards are Leading Cause of “Debt Regret”

Toronto, ON – March 26, 2012 – As Ontarians wait to see how the Province plans to balance its budget, a new poll finds that average Canadians are no better than politicians at managing their spending. A whopping 60.1% of Canadians are not comfortable with their current level of debt, according to an independent survey from RateSupermarket.ca, Canada’s largest impartial rate comparison service. Among the 2,929 respondents from across the country, the leading cause of debt concern by far (38.8%) is credit card debt.

“We found that one of the largest contributors to credit card debt seems to be impulse purchases of small items or food and entertainment, which, left to accumulate interest, can ultimately lead to a huge mountain of debt,” said Kelvin Mangaroo, President of RateSupermarket.ca.

One third of respondents admitted to going into debt over something that they later regretted; while many cited cars or bad investments as their largest “debt regret,” the common theme that emerged was that many have found themselves in financial straits not due to large lavish purchases, but rather through frequent, mindless spending on ‘wants’ like clothing, restaurants, gifts, and holidays.

“We’re not seeing people overspending on luxury or big-ticket items,” said Mangaroo. “Rather, it’s a slow and steady pattern of small purchases combined with smaller credit card payments that are putting a huge number of Canadians into debt.”

Many of those same people are also in denial: The majority (53%) believe that they have less debt than the average Canadian (30.7% believe their debt is average, while only 16.3% believe their debt is higher than average.) When specifically asked about credit card debt, the number of those believing their debt was below average jumped to 60.8%. Only 13% believe their credit card debt is above the national average.

But the dollar amounts would seem to contradict this belief. When asked about current credit debt levels, over a quarter of participants (25.5%) indicated they owed over $5,000 to credit cards. Close to 10% indicated owing over $14,000.

About RateSupermarket.ca (www.ratesupermarket.ca)

RateSupermarket.ca is the largest impartial rate comparison service for personal finance products in Canada. Founded in May of 2008, their easy to use comparison engine provides much needed transparency to the Canadian financial market and allows visitors to quickly find the best mortgage rates, savings rates and insurance quotes. Their new Mortgage Tool App for the iPhone also allows house hunters to compare mortgage rates using their Smartphone. Over 2M Canadians have turned to RateSupermarket.ca to save money on their mortgage, insurance, credit cards and GICs.

March is fraud prevention month. It’s an annual initiative to bring attention to what is a growing problem in Canada according to agencies like the Canadian Anti-Fraud Centre and Financial Consumer Agency of Canada (FCAC).

The FCAC warns fraudsters are aggressively hunting for victims online thanks to the growing popularity of social media sites, unsecured public Internet access points and online activities like shopping, buying and selling, dating and gaming. There is a chance, if you don’t take the proper precautions, that if you enter your personal information on a public page a fraudster can use it to build a false identity that has the likeness of you.

Identity theft and fraud can be anything from someone taking out a credit card bearing your name to a more sophisticated thief walking into a bank and asking for a line of credit secured by your home!

The Most Vulnerable Groups

Most at risk in Canada of becoming a victim of identity fraud are young people under 30 and seniors over 66. Both for very different reasons.

According to Visa Canada 32 per cent of those aged 18-30 are most likely to share personal information online.  This younger group is also most likely to share sensitive details like their pin number with friends and lend their credit cards to their peers.

Meanwhile seniors are at risk because they are most likely to keep their experiences with fraud secret from friends and family. Although less likely to share personal information online, seniors are often the primary target of fraud scams – particularly fraudulent phone calls and emails designed to solicit personal and financial information.

“Canadians of all ages have bad habits that impede their ability to protect themselves against financial fraud,” said Gord Jamieson, Head of Payment System Risk, Visa Canada. “Young adults need to better understand the risks associated with over sharing personal and financial data.” Jamieson also points out the other most vulnerable group is seniors, those aged 66 and older. They need to better understand that talking about fraud with someone they trust can help protect them from becoming a victim, he says.

How to Spot a Fraudster

If its too good to be true, it probably is! Fraudsters are constantly trying new ways to get at your personal information remember, a legitimate lottery and sweepstakes administrators never charge fees to deliver a prize. Also keep in mind advertisements running on a social networking site are not necessarily credible or reliable.

When surfing online, have you visited a site offering a product or service and were impressed by the list of happy customers. Often testimonials can appear quite believable by using so-called “satisfied customers”, “celebrities”, or “experts”, but don’t always believe them.  As well, if its a “free” trial offer then you should not be required to provide a credit card number. Always remember, keep your ABM pin code secret, don’t tell anyone and don’t write it down. In many cases,  protecting yourself comes down to trusting your so called “spidey-sense” and using common sense as well. If it feels wrong, it probably is.

Recommendations to Protect Yourself Against Fraud

The Government has provided the following recommendations to protect yourself against fraud.

Be vigilant when evaluating ads, whether for a job, a product or service offered online, over the phone or in print.

Before sending money or giving credit card or account details, be sure you understand what you are agreeing to. Do not feel pressured into paying for a product or service because of threats that your credit score will be damaged.

Know who you are dealing with. Be wary of any unsolicited phone calls, emails, text messages or letters from unknown sources.

Search for the company, the individuals, the product or the offer on the Internet, and verify any contact and company details.

Read the fine print to understand what you are agreeing to, particularly in emails or online messages.

Remember that trustworthy businesses will rarely contact you by email, phone or text message to ask for personal details, banking or financial information.

Keep in mind that wiring money is like sending cash—you have no protection against loss.

Beware of offers that promise “too much”!

The FCAC says if you become a victim

• Don’t be embarrassed to report it. Fraud can happen to anyone.
• Start a written log: write down when you noticed the fraud and the actions you took, including names of people you spoke to and dates of communications.
• File a report with your local police.
• Contact your financial institutions and any other companies (for example, your phone company, cable provider, etc.) where your accounts were tampered with, or are at risk of being tampered with.
• Advise Canada’s two credit rating agencies, TransUnion and Equifax. Ask them to put a fraud alert on your file.
• Contact the Canadian Anti-Fraud Centre’s national anti-fraud call centre at 1-888-495-8501 or by email at: info@antifraudcentre.ca.