Here’s What to Do to Protect Your Identity
In 2021 alone, identity theft cost Americans $56 billion. For those individuals it affects, identity theft can be a real nightmare. Thanks to the prevalence of large data breaches, your private information may already be in the hands of criminals. And don’t think your children are safe, either – thieves commonly target children for identity theft because most people don’t expect it, and it can be years before the theft is detected.
Repairing your finances in the aftermath of identity theft can feel impossible, especially if you’re facing the task alone. It’s much easier to take steps to protect your identity from theft. Here’s what you need to do to protect your identity – and your way of life – from financial fraud.
Protect Your Online Accounts
You should use a brand new, distinct password for every one of your online accounts – that way if hackers get access to, say, your email password, they won’t also be able to get into your bank account. A strong password uses a combination of special characters, numbers, and letters. Turn on two-factor authentication (2FA) for any accounts that have it. That way, if you get a verification request from one of your accounts, you’ll know someone has your password and is trying to get it. It can also help keep hackers out of your accounts.
Keep Your Social Security Number Secret
You should protect your Social Security number above all else, because it’s the ticket to your whole financial life. Don’t give your Social Security number to an institution unless they absolutely need it. That usually means only give it to lenders, banks, and your employer. If anyone else wants the info, ask how they’ll protect it, what they’ll use it for, and if there’s any alternative info they can use instead.
Put Important Documents in a Safe Place
Don’t carry around your health insurance card, your birth certificate, or your Social Security card. Leave documents with personal information on them at home in a safe place, unless you know you’re going to need them that day.
Don’t Leave Mail Sitting in Your Mailbox
Always bring in your mail immediately – mail theft remains a common means of identity fraud, especially because thieves can get ahold of credit and debit cards this way. Use Informed Delivery so you’ll know what pieces of mail to expect and can take action right away if anything is missing.
Check Your Credit Report Often and Monitor Your Score
You should check your credit report at least three times a year. You can go to AnnualCreditReport.com to get a free copy of your credit report from each of the three major reporting bureaus every year. That’s three free reports a year, and you should stagger them out so you can keep an eye on your credit all year long.
Better yet, use online identity theft protection software to monitor your credit every day. A sudden, unexplained drop in your credit score, or the appearance of unexplained new inquiries or new accounts on your credit history, can indicate identity theft, and you need to catch these changes as soon as possible to mitigate your losses.
Freeze Your Credit If You’re Not Using It
If you’re not planning to get a new credit card or take out a new loan anytime soon, freeze your credit. When your credit is frozen, no one can open a new account in your name – not even you. You’ll have to unfreeze it if you want to open a new account, but freezing and unfreezing your credit is as easy as calling just one of the three major credit reporting bureaus (Experian, Equifax, and Transunion).
If you have kids, have their credit frozen too to protect them. Even if you don’t freeze your own credit, definitely freeze your kids’ credit, at least until they reach the age where they want to take out student loans or otherwise begin building credit.
Be Aware of Common Email and Phone Scams
Scam phone calls are getting more common, as scammers these days can spoof any phone number they want to make it look like a call is coming from a government agency or a legitimate financial institution. Agencies like the IRS will never call you threatening legal action or arrest, or demanding payment. Know the signs of a scam call and avoid giving your personal or payment information on the phone to anyone unless you initiated the contact yourself. You should know how to identify phishing scams, too, and consider using an email filter for added protection.
Dispose of Financial Documents Properly
You should shred all of your bills, bank and credit card statements, investment statements, explanation of benefits forms from health insurance, and anything else you receive that has your personal information or financial information on it. Thieves will go through your garbage looking for documents that contain your financial or identifying information, so they can steal it.
Read Your Financial Statements Carefully
A thief who has accessed your bank or credit card account will often make a small purchase or deposit first to verify that they really do have access, then once they verify that, they’ll start making bigger purchases or try to drain the account. Review your bank and credit card statements meticulously to look for transactions you don’t recognize. If you see transactions you didn’t make on your account, you’ll need to open a fraud investigation with your institution and possibly close the account.
Identity theft is big business for thieves, but you don’t have to let them profit off of you. Lock down your finances, and keep identity thieves out in the cold, where they belong.
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Here’s What to Do to Protect Your Identity