According to the Federal Trade Commission blog, 25 million people are affected by fraud each year. You may think you would never fall victim to an obvious fraud, like the Nigerian email scam, which surprisingly totals over $12 billion in losses each year. But we face everyday scams and fraud from purchasing new investments to repairing our cars. Here are a few things to note to avoid being upsold or manipulated into buying something you don’t need.
Rental Car Insurance
Insurance upsells run rampant in the rental car world. Educate yourself in advance for what you need and stick to your decision. Some companies might tell you the rules are different in the state you’re renting the car in and that you’ll need to pick up liability insurance. If you have a major credit card, it’s unlikely you need to pay for extra insurance at the rental car counter. Don’t fall for the line that you’ll also need roadside assistance coverage. Your credit card or AAA likely already have you covered.
Other seemingly legitimate upsells may turn out to be less than useful. Renting a car seat for your child at the rental counter might produce a perfectly normal seat that meets safety standards. But many rentals turn out to be soiled and unsafe with broken belts and no accompanying manuals for installation instructions. When possible, travel with your own seat and just stick with getting a car. Esurance offers some other useful tips about renting a car.
Car Maintenance
Unnecessary auto repairs are the highest ranked cause of consumer complaints in the U.S. each year. Engine and auto flushes are common upsells that aren’t usually necessary. Transmission replacements, new head gaskets and using poor replacement parts without informing the customer are common upsells and scams. If you just need a routine service, like an oil change, and don’t want to do it yourself, print a coupon before you leave. It’ll set you on the right track to only buying what you need.
Look for mechanics endorsed by AAA and your own friends and family. Discuss your options for using quality parts and well-performing tires by brushing up on your car knowledge. TireBuyer has many educational pages hosted on its website. Remember to ask for any warranties and guarantees on service.
Mortgage Foreclosure Rescue
With a struggling economy, stories of mortgage foreclosure rescue scams and upsells are all too common. Owners looking for a miracle solution to their mortgage problems may be vulnerable to predatory lenders. These companies step-in and upsell you on contracts and loans that are impossible to repay.
Be weary of anyone who seeks you out on email or the phone and is overly enthusiastic about your chances of bouncing back. One sign of a bad upsell or outright scam is a loan with a limited-time low rate. These can skyrocket after just a few years. Anyone who asks you to exaggerate your income or promises the world is also bad news. If you’re struggling with your mortgage, visit your bank, a local credit union or look into the Treasury & Housing and Urban Development’s Making Home Affordable program.
Investment Fraud
You don’t need an investment broker or specialist to tell you what to do with your money at all. However, a financial adviser can help point you in the right direction to maximize your savings and grow your wealth. Before you get started, remember financial advisers may not charge you a fee for their services, but typically make a commission from selling you investment products and services. This could lead to unnecessary upsells and products you don’t need.
Look for a fee-only adviser who does not accept commission and ask for references before you commit to services. Ask your adviser for financial advice as opposed to sitting through a presentation of why you need five different retirement accounts and life insurance policies.
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