1998 Ad

Kiplinger's Personal Finance Magazine, Dec, 1998 by Kristin Davis, Robert Frick

Here's Backup Protection

The perfect place for your protected plastic is in a Beeping Wallet--a billfold with a microchip that beeps every 20 seconds when a credit card has been removed. It's both a last-gasp warning and a reminder to replace the card, says David Kopel, the wallet's inventor, who says he came up with the idea after his wife lost a credit card. The wallets are available in specialty stores and through catalogs.

A Gimmick You Can See Through

COMPETITION IS SO fierce in the credit card industry that issuers will resort to almost anything to get you to reach for their card instead of someone else's. That's the idea behind rebate cards that award points toward the purchase of everything from gasoline to Broadway-show tickets. But Chase Manhattan is betting that baby-boomers with deteriorating eyesight will reach first for their Lens Card--a credit card with a built-in magnifying lens that consumers can use to read, say, a restaurant bill or a rental-car contract. As long as you have the card out, the theory goes, you're more likely to use it to pay the tab.

What's the fine print on the Lens Card itself? The same as for Chase's other credit cards: a low teaser rate that jumps into the mid teens, arid a $29 fee if you pay late, bounce a check or exceed your credit limit.

Cash Is Still King

In a major real-world test of plastic cash by MasterCard and Visa, about 96,000 "smart" cards were distributed to residents of Manhattan's Upper West Side--who apparently found the idea pretty dumb.

A smart card, with a computer chip embedded, can be loaded with cash from the user's bank account. The amount is drawn down as purchases are made. When the card is empty, it can always be refilled at a bank or ATM.

But so far Manhattanites have snubbed the cards. The number of transactions has been relatively small, possibly because the trial run was plagued by technological snafus. Or maybe because most New Yorkers found it easier to throw down exact change for a newspaper. "I think it's absolutely pointless," one accountant told USA Today.

Meanwhile, Bank of America was touting its debit card, which substitutes for a check, as a remedy for stressed-out check-writers who worry about their poor penmanship. "Meticulously writing a check at a supermarket checkout counter while shoppers are fidgeting behind you can be very stressful," said Oakland psychologist Janet Hurwich in a Bank of America press release. "Your muscles tense tip. You begin to perspire. You may experience a rapid heartbeat."

Perhaps you should make two debit-card transactions and call your bank in the morning? Or just take a deep breath, relax your wallet and pay cash?

Weird Insurance: The Sequel

NOTHING BEATS A PET for love and affection--and, oh, an insurance discount, too. Midland Life, in Columbus, Ohio, gives seniors who own pets a break on their life insurance premiums. Owning a dog, cat, bird--even a snake or a sea monkey--can cut a 70-year-old's life insurance premiums by 10%.

In the category of weird policies are contest coverage--which pays when a basketball fan hits that million-dollar, midcourt foul shot at halftime--and even insurance that covers cosmic calamities, such as satellites hit by meteors. AXA Space Inc., a space-insurance company in Bethesda, Md., was one of the insurers that collectively paid out $200 million to the owners of the Galaxy IV satellite that failed in August, interrupting pager service and other telecommunications all over the country. The premium for peace of mind in space? About $4 million a year.