Tips for Protecting Yourself from Identity Theft
By NerdWallet(view all posts by NerdWallet)at 8:57AM Thursday February 10, 2011
under Personal Finance
We've all seen the Citibank commercials where young criminals speak through the mouths of their identity theft victims. It's not a pretty picture.
Yet, the reality of getting your identity stolen may be even more ugly. Think of all the time spent and hassle involved with retracing your new enemy's tracks. After using your personal info to set up credit card accounts, having fun literally at your expense, your credit score's gone to pot and you have to spend months if not years digging yourself out of their hole.
Not fun is it?
What's the best way to counterattack these thoughtless thieves? The short answer is to prevent it from ever happening in the first place. But these days, it takes a lot more than holding onto our wallets to prevent thieves from stealing our money. Identity theft criminals are getting savvier.
To stay one step ahead of them, here are five steps you can take to secure your savings:
In addition to the five steps above, periodically check your credit report with the three major credit bureaus, as well as keeping close tabs on your credit card statements. Any potential fraudulent activities such as new credit card accounts you did not apply for or charges you don’t recognize should be noted and dealt with as soon as possible. The sooner you find out you have been the victim of identity theft, the sooner you can take the necessary steps to stop identity thieves from taking over your financial identity and your life.
Yet, the reality of getting your identity stolen may be even more ugly. Think of all the time spent and hassle involved with retracing your new enemy's tracks. After using your personal info to set up credit card accounts, having fun literally at your expense, your credit score's gone to pot and you have to spend months if not years digging yourself out of their hole.
Not fun is it?
What's the best way to counterattack these thoughtless thieves? The short answer is to prevent it from ever happening in the first place. But these days, it takes a lot more than holding onto our wallets to prevent thieves from stealing our money. Identity theft criminals are getting savvier.
To stay one step ahead of them, here are five steps you can take to secure your savings:
- Prevent Anti-Theft Thieves. Thieves these days are taking advantage of anti-theft technologies to steal credit card information from several feet away. Yes it's true. The Better Business Bureau in Michigan wrote about it on their Detroit site this past December. It's called "electronic pickpocketing" and can be done with Radio Frequency Identification (RFID) technology.
How does it work? According to the article, RFID is the same type of technology used in stores and libraries to scan for stolen items and books. And it can be accessed through an individual’s laptop and Internet device to obtain your personal information. Scary isn’t it? Thank goodness for the BBB who provides tips on their website, like wrapping your credit cards with foil. - Be a stickler when it comes to giving out information. You may have received an email from what looks like a reputable company requesting your information. Similarly, someone may call from your favorite department store asking to update your personal information in his or her system. What should you do?
Before handing over your details, find out who they are, why they need this information and what it will be used for. If you are skeptical about any online company asking for information in an email or newsletter (as you generally should be), go directly to their website instead of clicking on the email and contact a representative to make sure the information you received is legit.
Alexis A. Moore, a risk management and credit collections executive consultant says, “It is best to provide the information by phone when the consumer calls the bank or finance company directly and through the web site of the financial institution directly not via an unsolicited email.” - Get rid of the evidence.It's hard to believe anyone would go through your garbage to find personal information. But your trash could be somebody else’s treasure. The Social Security Administration provides information and tips online to prevent identity theft. One of which is to shred all identifying papers.
Certified Money Management Volunteer Kim McGruder says, "Collect your mail regularly and destroy unwanted credit solicitations. Harmless junk mail such as balance transfer credit card applications and checks for cash advances from credit card companies can be picked out of your trash and used to open new accounts so beware. - Hide the jewels. Your social security card is a thief’s entrance into the big leagues. It gives them access into your banking accounts, credit card information, essentially any aspect of your financial life. Although you may carry your credit cards in your wallet, the Social Security Administration advises that you put your social security card in a safe place and not in your wallet where it can be easily stolen.
As for those old, rarely used rewards credit cards, McAfee Consultant and Identity Theft Expert Robert Siciliano suggests slimming down your wallet by keeping cards in a safe, canceling, or shredding them to prevent cards from being placed into the wrong hands. - Be password savvy. Don’t make it easy for identity thieves to get your information by choosing simple, intuitive passwords. When Gawker's user accounts were hacked last year, reports showed that the most common passwords included things like "123456." "password," and "qwerty." And hackers know that passwords often contain personal info like birthdays or childrens' names. So avoid using anything that fits this mold.Moore also suggests consumers change their password at the beginning of every year.
In addition to the five steps above, periodically check your credit report with the three major credit bureaus, as well as keeping close tabs on your credit card statements. Any potential fraudulent activities such as new credit card accounts you did not apply for or charges you don’t recognize should be noted and dealt with as soon as possible. The sooner you find out you have been the victim of identity theft, the sooner you can take the necessary steps to stop identity thieves from taking over your financial identity and your life.
This post comes from Tim Chen, CEO and founder of NerdWallet.com, a site dedicated to helping consumers find the best low APR credit cards.
