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Plastic "Perks" That Should Be Free

There's just some stuff that should be free. A decent-sized cup of water at the movies is one. Here are four other should-be-freebies you've probably been offered by your lender. Trust us, keep your money in your wallet.

ID theft protection: Chase will probably disown me as a customer. But I had to scoff at an e-mail solicitation the company sent me yesterday. For just $7.99 a month (after a generous free 30-day trial) I can sign up for Chase's Fraud Detector service. No thanks. The company's three-pronged program offers to monitor my transactions and report out-of-the-ordinary ones within 24 hours. (As Fools on the Consumer Credit discussion board have pointed out, most lenders do this anyway so that they're not out the dough.) I can also get a Chase Case Manager to inform the credit bureaus if my identity is compromised. FYI: These days a phone call to one bureau alerts all three majors. (Here's all the contact information you'll need on one page at Fool.com. It's free.) And finally, I can get reimbursed for "qualifying expenses" (up to $5,000) incurred trying to clear my good name. Wonder how many hoops I'll have to jump through to get them to pay for those few hours of work I missed while I was changing all my PINs.

Credit insurance: Similarly, this "perk" preys on fear and is as necessary as a bee suit in Alaska. For an exorbitant premium, the insurer agrees to make minimum payments on your debt should you become unable to. You'll pay $13 a month to get a credit protection plan for a $2,000 balance. The laws of probability -- and the Federal Trade Commission -- are on your side anyway. And they're free.

Preferred member status: They send you a sticker to put on your card, and automatically, you're eligible for discounts at dozens of restaurants. Funny how the yearly fee doesn't show up until after you unwittingly use this perk. Before using the sticker -- or agreeing to an upgrade -- ask to see the price tag, and make sure the perks are ones that you'll actually use. "Cash back" sounds like something you could use? Nowadays, you can get this perk without paying an annual fee. (Heck, we offer our own Foolish cash-back card. Compare it to other offers and see whether it passes muster.)

Upgrades to Gold, Silver, Platinum, or Angora status: Though cards with higher precious-metal factors have some advantages, there's probably no reason to pay for an upgrade if you have a decent credit record. In time, if you are a good borrower, you'll qualify for more extended moolah anyway.

Extra "conveniences": "Convenience checks" carry conveniently high fees and interest rates. Plus, most of them do not include a grace period, so you start incurring interest the moment you cash the check. Also, beware of any promotional offer sent to you by your lender. Read the fine print, because in the lending industry, there's rarely a free lunch.


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