10 Ways to Prevent, Detect, and Fight Identity Theft
Clearing up identity theft requires time and money—hours getting reports and affidavits proving the theft, figuring out what's been compromised, and then working to recover your identity. That's a lot of time to spend recovering from a crime of which you were a victim.
While you can't fully prevent identity theft—for example, if your information is compromised in a data breach—you can greatly reduce your risk by acting quickly when your personal information has been compromised, and by taking steps to protect yourself from identity theft.
Place a Fraud Alert on Your Credit Report
A fraud alert makes it harder for thieves to open accounts in your name by warning other businesses to confirm your identity before moving forward with an application. You can place a fraud alert on your credit report by contacting just one of the three credit bureaus and it's free. A fraud alert lasts from 90 days to 7 years depending on the type of alert you add.
Adding a fraud alert to your credit report entitles you to a free copy of your credit report. It's a good opportunity to review your report for any suspicious activity.
Freeze Your Credit Report
A security freeze goes a step beyond a fraud alert because it requires you to unlock your credit report with a PIN or password before a business can pull your credit.
It's free to freeze your credit report and unlike a fraud alert, the security freeze doesn't expire. You'll also have to provide proof of your identity and request a security freeze with each credit bureau separately.
Order Your Free Credit Reports
Each year, you're entitled to one free credit report from each of the three credit bureaus. By ordering one of your three reports every four months, you can keep an eye on your credit all year long. The only drawback to this method is that you only see one bureau's report at a time. So if the identity theft doesn't show up on all three of your reports, you could miss it for a year.
Buy Your Credit Reports
If you've used up your annual credit reports, you can purchase your full report directly from the credit bureau or through myFICO—or use a free credit monitoring service like Credit Karma. You can choose whether to purchase a credit report from a single credit bureau or a three-in-one credit report which gives you a more complete view of your credit history.
Monitor Your Accounts Online
Creating an online account with your bank and each of your credit card and loan accounts allows you to easily keep up with your account activity. Log in to check your account periodically to make sure no unauthorized charges have been made on your account. Keep your login information safe by not writing it down and not telling it to anyone.
Some banks and credit card issuers offer fraud notifications to alert you to suspicious activity on your account. These notifications can help you catch unauthorized use before extensive damage is done.
Enroll in Credit Monitoring
Even though we don't recommend it because of the high cost versus alternatives, credit monitoring is one way of detecting identity theft. Compare the cost of some credit monitoring services to the cost of ordering your credit report, and you'll find that buying a few credit reports a year can be cheaper. If you decide to sign up for credit monitoring, make sure you shop around.
Keep Your Social Security Number Safe
In the wrong hands, your social security number can be lethal to your credit. Avoid carrying your social security card in your wallet. Don't write your number down, enter it in a non-secure website, or send it over public wifi. Be wary of who may be watching or listening when you give your number to customer service representatives.
Pick Up Your Check Order
Stolen checks are another way thieves take your identity. With your routing and checking account number, a thief can create new checks and use them to make purchases. When you order new checks, consider picking them up from the bank rather than having them mailed to your home. Report any missing check orders to your bank right away.
Stop Pre-Approved Credit Card Offers
Those pre-approved credit card offers have your personal information on them. Thieves have been known to use these offers to get credit cards in the victim's name. Shred credit card offers before throwing them away. Or stop them altogether by opting-out either temporarily or permanently.
Pay Your Bills Online
In #8, you learned that identity thieves use checks to steal your identity. Well, they can also steal checks out of your mailbox when you mail bills. Many banks now offer online bill pay. If you can't send your bills from a secure post office box, pay them online on a secure network, like your home wifi, to protect your account information.