LEARN. LIVE. LOVE. There is one important NEW Year’s wish today that I have for the readers of Moneywise. And it is, that everyone learns to become independent and technically proficient in the new electronic age, and in the process, loves taking care of their financial security. Some of you, sitting off having that steaming cup of tea or coffee, having a read of the “daily blatt” are now thinking, “what a dumb statement. I’ve got a cell phone, what is she talking about?”

Actually, it isn’t dumb or stupid (although here I admit that I’ve been roundly vilified for stupid statements on more than a few occasions) for many, many people who are not comfortable with the internet and other advanced ideas, who don’t want things to change, or who find the opportunity to change a real hurdle. It isn’t surprising then to realise that those who avoid change also learn few new concepts. Is this a disease of old people? Not necessarily. Overcoming resistance to change is a challenge in all age groups. Those who feel their physical being may be old, know that your mind is not. In fact, your intellect carries the accumulated wisdom and experience of the ages.

But the reasons to change and learn are far more serious than just learning something new. Your very financial independence and comfortable future depends upon understanding your environment. You don’t have to be a computer technical guru to learn some security measures. Herewith is my list of the most important Do’s and Don’ts for 2014.

1 Do learn to operate fully in the electronic environment. Do you know how Twitter, Tumblr, Instagram, Pinterest, ZMOT (Zero Moment of Truth), Vine, Facebook, Google+, LinkedIn, YouTube, Mention, Swayy, Tagboard, Evernote, and Flickr work? If not, time to find out. When the largest Interest retailers on the globe announced this holiday season that they would be comparing and changing pricing on products every ten minutes, you realise that you cannot rely upon the traditional retail method to purchase anything. Smart phone applications that scan prices, then compare them to other shopping sites are the norm. Who wants to miss any bargains? Twitter demonstrated to the world the 140-character forceful Tweet voice for the immediate delivery of news, political points, opinions, tracking of people, media and suspects after the Boston Marathon tragedy last year. Relied upon now by everyday citizens and law enforcement teams, Twitter even appears to be replacing (or enhancing) phone technology. And possibly, ordinary conversation.

2 Do search Google whenever you need to understand a finance question, or anything else, for that matter. Google is your best research friend and far better than your Uncle George — who used to be the knower of all things. Now the internet is the knower of everything, however, remote. Just type any question. The answer is there, often in the thousands, just for your illumination. Years ago, an inquiry for advice (from a client) regarding the credibility of an “investment guru” that was pushing a debatable high-investment return product, was solved in a matter of minutes. Typing the guru’s name into Google revealed multiple court cases and pending convictions for embezzlement, dubious internet schemes and investment fraud. Google was in its infancy then, but it was already becoming a powerhouse in gathering all sorts of great information.

3 Do pay attention to your bank accounts, credit card / debit card, investment, and pension balances. Go online — on a daily basis. If the latest debacle of 40 Million debit accounts hacked at the US Target department store chain has any lesson attached, it is this. You cannot rely upon reviewing your latest monthly printed statement to be sure that your accounts are intact. Please don’t tell me you don’t have a debit card, so you don’t need to do this. Owning (or not owning) a debit card is only part of the equation. Internet thieves across the globe routinely seek to access your identification in order to clean out all your financial accounts. The best way to detect and prevent electronic theft is to be constantly electronically savvy.

The challenges for retailers to prevent internet thefts is enormous, continuing and escalating. In 2007, TJ Maxx (owner of Marshalls, HomeSense and other stores globally) was hacked with an estimated 46 million customer accounts stolen. Astoundingly, the thefts were undetected by their internal security for more than three years. TJ Maxx has paid to date more than $256 million to various banks as reimbursements for the fraud.

4 Do read the fine print on all of your financial contracts. If you haven’t perused your debit/credit card application agreement with your bank, or investment firm, for instance, do it now. Yes, it is mind-numbing (16 pages of fine print for one credit card alone) in detail and math calculations, but it is a very important document. Encapsulated within are the terms and conditions that your bank or credit company will adhere to protecting your accounts, whether debit or credit, against fraud and theft. Understand that there are gradient degrees of protection, ranging from none to 100 percent reimbursement, relative to theft and discovery as well as significant distinctions between debit and credit cards. Common debit card protection (if even offered) may require that you, the account holder affected, must contact the bank (or financial institution) within two days of discovery of the actual theft to receive a full refund, after that, you may receive a partial refund, or none at all. Unfortunately, many debit account holders in the United States and elsewhere may be finding out to their utter dismay, that their compromised debit card balances have little to no protection. They are on the hook for the full stolen amount!

5 Do refer again to do #3. If you rely upon tracking your account activity on a paper statement monthly basis, you may find that your account is worth just that — a piece of paper. Do read one of the best articles available on the differences between debit and credit cards and the strategies for handling them. “Debit Use Risker than Credit” by Gregory Karp, Spending Smart, The Chicago Tribune, May 20, 2011.

6 Do practise business diligence. The monitoring of your accounts daily (all bank, investments, insurance, pension and social security / insurance payments, etc) and rigorously is a must if you are a small-business owner. It is doubly important that you have all of your printed statements mailed directly from your financial institutions to you personally at your home (bypassing your office finance people) as well as checking your bank and investment financial activity online daily. More business owners have been scammed by trusting too much, while not practising basic due financial diligence. Latest in the news this week, a small US sole attorney law firm lost $450,000 — siphoned off unnoticed over time by the company’s book-keeper in another depressing routine of white collar theft.

7 Do track your other important personal information. You should have access to managing and tracking your pension accounts, as well as monitoring your medical health accounts (yes, this is provided in the US at most hospitals) and may be offered already in Bermuda. Your personal files belong to you.

8 Don’t use awful electronic passwords and change them frequently. According to HuffPost Tech, the most popular password in the world — for the second year in a row is, take a guess? Password. The Splash Data Press release cited the top 25 popular passwords in line as “The top three passwords of 2012 -- “password,” “123456,” and “12345678” -- remain unchanged from the 2011 list, while others such as “baseball,” “iloveyou,” and “111111” became a little more popular in 2013. New entries to the top 25 include “jesus,” “ninja” and the highly imaginative “password1.” Splash Data further stated that these passwords “are the most likely to be victims of security breaches”. Splash Data is an electronic security product company. Their data is derived from perused millions of stolen passwords posted on line by hackers. Come on, people, we can do better than that!

LEARN. LIVE. LOVE.

Learn, learn, learn. Knowledge is there to make our lives better. Learning more never hurt anyone. Remaining blissfully ignorant of important facts that may affect you can be a disaster. In learning, you will live better, and love the feelings of self-accomplishment while protecting your own and your family’s financial security.

My best wishes for a successful New Year 2014.

Sources:

The Chicago Tribune: http://articles.chicagotribune.com/2011-05-20/news/sc-cons-0519-karpspend-20110520_1_debit-card-fraud-credit-card

** Huffington Post http://www.huffingtonpost.com/2012/10/25/most-popular-worst-passwords-of-2012-splashdata_n_2018587.html, October 25, 2012.

Next, living in a world community no matter where it is, means cooperation and an element of trust. Should we fully trust any person, institution, or government to do the right thing?

Martha Harris Myron JP CPA PFS CFP is a Bermudian journalist and a cross-border financial planning specialist. Pondstraddler Life™ Consultancy provides offshore financial perspectives for international citizens living, working, crossing borders, and straddling ponds in the North Atlantic Quadrangle: United States, Canada, United Kingdom, Europe, and the island of Bermuda, the premier international finance centre. For consultations, publications & presentations, contact martha@pondstraddler.com or on 735-4720.