Online spending in the United States is expected to hit $370 billion by 2017, up from $262 billion in 2013, according to Forrester Research. Online consumers are most likely to shop for books, stationery, or office supplies, followed by apparel and consumer electronics, based on an NPD Group study. Online shopping can be a great convenience, but CPAs advise that there are steps you should take to ensure a safe and satisfying experience. With the holiday shopping season about to begin, the Pennsylvania Institute of Certified Public Accountants (PICPA) reveals five mistakes to avoid.
Mistake #1: Taking a Chance on Unknown Retailers
When making a purchase from a company that may not be well-known, or one with which you haven’t already done business, take some precautions to ensure a reliable transaction. Be sure the company lists an address and phone number, and try calling the customer service number to get answers to any questions that may concern you, such as how the company handles returns, refunds, and consumer complaints. You can also contact the Better Business Bureau or your state or local consumer affairs department to see if any purchasers have filed complaints.
Mistake #2: Following Unknown E-mail Links
Don’t click on links in unsolicited e-mails or social media sites, even if they purport to be from trustworthy retailers, because they may take you to sites that are trying to collect information for identity theft. Instead, type the organization’s website address into your browser’s address bar or find it through a search. Never divulge personal information—including your credit card, bank account, or Social Security numbers—in response to an ad or e-mail.
Mistake #3: Shopping at Sites that Aren’t Secure
You can get a lot of clues about security simply by checking the company’s website address. For example, look for URLs that begin with “https” rather than “http.” The added s indicates it is a secure website. Also check for a padlock icon in the address bar to show the site uses encryption to ensure security, and click on the lock to learn the details. Review the retailer’s privacy policies to find out if they are designed to protect your credit card information and other confidential data. Remember, Internet scammers often use a name that is similar to a reputable brand, but they alter the spelling or simply misspell words in their website name or communications. If something looks suspicious, don’t buy from the site.
Mistake #4: Not Using a Credit Card
Charging a transaction allows you to dispute the purchase if it doesn’t arrive or doesn’t live up to expectations. At the same time, since identity theft—including unauthorized use of credit card numbers—is growing, be sure to review your credit card statements regularly. Contact the credit card issuer if you find anything that shouldn’t be on your bill. Finally, online retailers should provide you with receipts for your purchase when it’s completed, with an order or confirmation number. Save the receipt and hold on to it until you receive the product or service so you have proof if you need it.
Mistake #5: Shopping Using a Public Wi-Fi Connection
While it’s fun to settle in at a coffee house and do some shopping, it’s generally a bad idea. The connection you use may not be secure, meaning hackers may be able to gain access to the personal information you share with the retailer and use it to make unauthorized purchases.
Smart Tip: Consult Your CPA
CPAs can offer advice to help you make smart spending decisions and keep your finances on track. Turn to your local CPA with all your financial questions. To find a CPA in Pennsylvania by location or area of expertise, ask family and friends for recommendation or use PICPA's CPA Locator.