These days, it seems as if everyone is shopping online. Consumers appreciate the convenience of shopping in their pajamas, the vast amount of product information available online and the ability to compare prices at a glance.
Is it safe? Many shoppers worry about identity theft, but hand their credit cards to strangers on a routine basis. How many times have you handed your card to a waiter you did not know or to a salesperson over the phone? Any time you use your credit card number, there is some risk that it will be intercepted. Credit card companies know this, and have established measures against fraud. Most card companies limit your liability to $50 for any unauthorized use.
There are everyday precautions you can take to prevent disaster. We've outlined a few of the most important online shopping tips below.
Shop at Secure Sites
To prevent third parties from intercepting your credit card or personal information, shop only at secure sites. Secure sites use encryption to scramble information so that only they can read it. How do you know if a site is secure? You'll see a pop-up message in your browser and a locked lock icon will appear at the bottom of the screen.
Pay with Plastic
Buying with a credit card is the safest way to shop online. If your purchase doesn't live up to claims advertised by the retailer or if goods aren't delivered as promised, you can contest the charges. Some card issuers offer special credit cards that guarantee 100 percent of online purchases. Most cards limit your personal liability to $50. If you pay with a check, you won't have the same protection.
Verify a Vendor's Reputation
Look for the company's physical address and phone number. If something looks suspicious, check the company's reliability with an organization like the Better Business Bureau. Dozens of BBBs provide business reliability reports online, and others provide them by call, fax or e-mail.
Answer Questions Sparingly
When you place an order online, you usually have to fill out a form with personal information. Some is necessary (they need your address to ship the goods, your phone number in case there's a problem, etc.) Other information, such as your income level or age, is not. Many merchants will place an asterisk next to required fields. Answer only those questions and never give out your social security number. There is no reason an online merchant would need this information, and it could be used to steal your identity.
Some sites require you to create an account with a password. Never use the same password that you use for other accounts. And never reveal a password in response to an unsolicited e-mail, even if it claims to be from your Internet service provider.
Check Privacy Policies
Prices vary widely and it pays to shop around. Comparison shopping sites will scan the prices of a variety of popular goods for you, including books, CDs and computer products.
Check Return Policies
Research each merchant's refund and return policies. If you are unhappy with the product, will it be easy to return? Check out our page of return policies at many popular stores.
Check Shipping Times and Fees
Make sure that shipping and handling charges are clearly disclosed. The best sites tell you what you'll pay for delivery before you fill out the order form. But in other cases, you can usually cancel the order after filling out the order form, but before accepting the terms. If you need the product or service to arrive within a certain time frame, check to see what guarantees the merchant can make.
Print out a copy of your order and a confirmation number for your records. This information will prove useful if you need to contact the company later. If the merchant provides a customer service phone number, jot this down for future reference.
Ready to bid on a hot item? Check out our guide to the best auction sites, and follow these auction safety tips:
Pay by credit card when you can. If you never receive the merchandise, you can contest the charges with your credit card issuer.
Check on the seller's reputation. If you can't, consider it a red flag.
Avoid impulse buys. Auctions don't always deliver the best price. Do your research first to determine fair market value.
Ask about return policies.
If you bid at a person-to-person auction and win, you will probably be asked to send a personal check to a stranger. Look for sellers with a clean history. Ebay offers a "Feedback Forum" where buyers and sellers can post comments about a seller, which form the seller's feedback rating. The higher the number, the better chance you're dealing with an honest individual. But the system isn't foolproof - sleazy sellers sometimes give themselves false praise.
If a deal seems too good to be true, it probably is. Pass it by.
Research Internet Scams
The following sites keep an eye out for fraudulent vendors. Visit their sites for more information on avoiding scams:
These services screen merchants for safe shopping practices. They require participating merchants to meet a variety of guidelines. The criteria for each network will vary. Visit each site to learn more:
Bizrate.com This site lists customer-rated merchants ranked by performance. The site is searchable by product or merchant.
ePublicEye.com Companies listed in this "Safer Shopping Network" agree to be constantly monitored for reliability and customer satisfaction.