Safeguarding Your Nest Egg: A Practical Guide to Protecting Yourself from Identity Theft

Identity theft is no joke. But fear not! We've got your back with some practical tips to keep your credit frozen and your finances secure.

Let's start with freezing your credit. It makes it nearly impossible for identity thieves to open new accounts in your name without your permission. 

Freezing and locking your credit are both effective tools for preventing unauthorized access to your credit file, but there are some differences between the two:

Freezing Your Credit:

 

When you freeze your credit, you essentially restrict access to your credit report. This means that lenders and creditors cannot view your credit report or credit score unless you specifically lift or remove the freeze.

Freezing your credit is typically free and offers strong protection against identity theft because it prevents new accounts from being opened in your name without your knowledge.

You can freeze and unfreeze your credit as needed, allowing you to apply for new credit when necessary by temporarily lifting the freeze.

Locking Your Credit:

 

Locking your credit works similarly to freezing, but it may be offered as a service by credit monitoring companies or credit bureaus. This service often comes with a fee or subscription.

Unlike a freeze, which is governed by federal law and requires contacting each credit bureau individually to enact, locking your credit may be done more conveniently through an online portal or mobile app provided by the credit monitoring company.

Locking your credit may offer faster and more convenient control over access to your credit report, as you can typically lock and unlock it with the click of a button.

Here's how to do it:

Contact the Credit Bureaus:

Get in touch with Equifax, Experian, and TransUnion – the three major credit bureaus. You can freeze your credit online, by phone, or by mail. Make sure to keep a record of your freeze PINs in a secure place.

Freeze Your Credit:

Once you've contacted the credit bureaus, they'll freeze your credit file, adding an extra layer of protection against unauthorized access.

Stay Vigilant:

Regularly check your credit reports for any suspicious activity. You're entitled to a free credit report from each bureau every 12 months through AnnualCreditReport.com.

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Damage Control

Now, let's talk damage control. If you suspect your personal information has been compromised, here's what to do:
Act Quickly: Don't waste time – contact the credit bureaus and place a fraud alert on your credit reports. This alerts creditors to verify your identity before opening new accounts.

File a Report

Report the identity theft to the Federal Trade Commission (FTC) at IdentityTheft.gov. This helps authorities track down the perpetrators and protect others from falling victim.

Monitor Your Accounts

Keep a close eye on your bank and credit card statements for any signs of fraudulent activity. Notify your financial institutions immediately if you spot anything suspicious.

If you think you are at risk, you may want to consider a paid credit monitoring service which goes beyond alerts from the three bureaus. One you’ve probably heard of if you watch daytime television is Lifelock. Other name brands are IDShield and Identity Force. We haven’t tested these ourselves but this article has a nice rundown of the features of each service. 

Alert your Financial Planner

Your planner is an important line of defense against fraudulent money movement. Telling your planner so they can leave critical notes and alerts on your account can help stop someone who has your information and is trying to access your funds.

Protecting yourself from identity theft is essential when so much of our information is ALREADY fairly readily accessible by criminals. By taking proactive steps to freeze your credit and staying vigilant, you can safeguard your financial future and keep those pesky thieves at bay. So, don't wait until it's too late – take control of your credit and protect what's yours.

AJ Grossan