Identity Theft is one of the worst things that can happen to your personal finances. When someone assumes your identity they can ruin your credit score and destroy your financial reputation for years. Identity theft is a growing crime, but there are some important measures you can take to avoid having your identity stolen.
How to Avoid Identity Theft Online
The Federal Trade Commission maintains an Identity Theft Awareness website that outlines three important steps for avoiding identity theft: Deter Identity Theft, Detect Identity Theft, and Defend Against Identity Theft. Using these three steps can save you from an expensive and damaging experience.
Deter Identity Theft
The first step and most effective way to prevent identity theft is to deter identity thieves. Don’t give thieves a way to get your personal or financial information. This includes being vigilant with any personal and financial data. These tips will help:
- Secure your financial data under lock and key.
- Don’t carry your Social Security Card in your purse or wallet.
- Shred, burn, or destroy old financial or personal documents when no longer needed.
- Use secure computing methods to deter identity theft.
- Use secure passwords and change them often.
Detect Identity Theft
The next step is to detect identity theft if it has occurred. The more quickly you discover identity theft, the easier it is to limit the damage to your credit and the easier it is to get the situation resolved.
Monitor your credit report and look for errors. Everyone is eligible for 1 free credit report per year from each of the three major credit bureaus – Equifax, Experian, and TransUnion. You can order these free credit reports from AnnualCreditReport.com. The most effective way to monitor your credit is to stagger your free credit reports and get a free credit report from each of the three major credit bureaus every 4 months.
Here are several ways you can detect identity theft:
- Use an identity theft protection company to monitor your credit reports, scores, and financial accounts. (See trial offers below).
- Use a credit monitoring service to monitor your credit reports.
- Receiving unexpected bills for items you did not purchase.
- Calls or letters from bill collectors or creditors for items you did not purchase.
- No longer receiving expected bills.
- Denials of credit when you should be qualified.
You should make it a habit to review your financial statements on a monthly basis and get into the habit of getting your free credit reports.
Identity theft monitoring offers:
The following commercial identity theft monitoring companies offer free trials and discounts:
These offers may help you prevent, discover, and repair identity theft problems.
Defend Against Identity Theft
If you notice any outward signs of identity theft, take action immediately! The first step is to place fraud alerts on your credit reports. Then take the following actions:
- Review your credit reports carefully to determine where the security breach occurred.
- Close accounts that have been tampered with, or that you suspect may have been accessed fraudulently.
- Report the theft to the Federal Trade Commission.
- File a police report where the theft took place. Most creditors will want proof that a crime has been committed.
You can also place a credit freeze which will prevent anyone from opening new accounts in your name. This will not stop them from using accounts which have already been opened, which is why it is important to close any account that has been tampered with.
Identity Theft is a Serious Crime
You have the power to prevent many forms of identity theft if you are vigilant with yuour financial records and actions. While you may not be able to prevent every instance of identity theft, these steps will go a long way toward protecting you, your credit report, and your personal finances. Good luck!