The FBI lists identity theft as one of the fastest growing crimes in the United States.
Over 10 million Americans will be victims this year alone and criminals are getting more sophisticated in their attempts to strip you of vital personal information. Their success can mean hundreds of lost hours, thousands of wasted dollars, and a scarred credit report for you.
- Review Account Statements – Unauthorized activity can often be detected by looking at your bank, brokerage, credit card, and other account statements. It will require more than a quick glance—take a few minutes to review each charge. Highlight any charge, withdrawal, or suspicious activity and immediately contact the company that issued the statement. Because of the proliferation of identity theft, almost all credit card companies have entire divisions set up to support the investigation of fraudulent account charges.
- Use a Shredder – Any receipt, account statement, “pre-approved” credit offer, or document with your social security number, account number, or any personal information other than your name and address should be routinely shredded. In order to receive the maximum protection, you should use a cross-cut shredder. You can buy an adequate cross-cut shredder for under $100.
- Protect Your Social Security Number – Don’t keep your social security card in your purse or wallet and don’t provide your Social Security Number on applications—although many forms ask for it, rarely do you need to provide it. When applying for a loan, a credit card, or job, it is usually safe to provide your social security number. If your number is listed on your checks, have new checks printed without your number—it is not necessary and certainly makes obtaining your number easier for thieves.
- Secure Your Mail– Get a mailbox with a lock that allows the postal carrier to deposit mail but requires a key to retrieve the mail. Your mailbox contains a wealth of personal, valuable information that identity thieves can easily exploit. Deposit outgoing mail at a post office or in a postal collection box. If you will be away from home for more than five days, call the U.S. Postal Service at 800-275-8777 and ask for a “vacation hold.”
- Password Protocol – Don’t use obvious passwords such as your address, date of birth, anniversary date, social security number, or phone number and do not keep a list of passwords in an accessible location. Passwords containing a combination of letters and numbers are best. For example, “tennis1992” is a better password than just “tennis.” Do not use your mother’s maiden name as a password. A lot of companies still ask for the customer’s mother’s maiden name as protection, but it provides absolutely no protection from an identity thief since thieves can discover this name fairly easily. Instead, ask the company if you can use a password you’ve created.
- Keep Personal Information Personal – Protecting yourself from “pretexting” by avoiding giving personal information over the phone, email, or mail unless you know the source is legitimate. If you get a call from someone who claims they are with your credit card company, get her extension and call her back by using the phone number provided on your account statement.
- Cancel Unnecessary Credit Cards – Do you really need eight credit cards? Flip the card over, call the toll-free number on the back, and cancel the card. It will take less than two minutes and serves as one more way to safeguard your identity.
- Monitor Your Credit Report – This is a must. The easiest and most effective method is to hire a company to do this for you. IdentityGuard will provide quarterly credit reports and daily monitoring with alerts if new accounts are opened, inquiries are made, or addresses are changed. IdentityGuard monitors your credit activity and resulting score from all three credit bureaus—Equifax, Experian, and TransUnion. Most credit monitoring services monitor only one bureau. Verify that the company you choose will monitor all three.
Be on the lookout for these potential signs of identity theft. If any one of these occurs, take immediate steps to make sure you are not a victim.
- If you fail to receive a monthly credit card or account statement. If you fail to receive a monthly statement, an identity thief may have changed your mailing address so you won’t receive the bills containing the fraudulent charges.
- If you receive new account correspondence or a new, unsolicited credit card, there is a good chance that a thief applied for the account using your identity.
- If you have good credit but are inexplicably denied for a loan or credit card, there may be unauthorized activity in your name affecting your credit report.
- If you get a call from a debt collector or credit card company regarding unpaid bills or late payments, you may already be a victim. Get as much information as possible and place a freeze on any new purchases.
The proceeding blog post is an excerpt from The Six-Day Financial Makeover: Transform Your Financial Life in Less Than a Week!, available now on Amazon.
About the Independent Financial Advisor
Robert Pagliarini, PhD, CFP®, EA has helped clients across the United States manage, grow, and preserve their wealth for the past 25 years. His goal is to provide comprehensive financial, investment, and tax advice in a way that was honest and ethical. In addition, he is a CFP® Board Ambassador, one of only 50 in the country, and a real fiduciary. In his spare time, he writes personal finance books, finance articles for Forbes and develops email and video financial courses to help educate others. With decades of experience as a financial advisor, the media often calls on him for his expertise. Contact Robert today to learn more about his financial planning services.