Last week, Equifax released that earlier this year, hackers obtained the personal data of around 143 million people on its system. Equifax, one of the three major credit bureaus, is responsible for creating credit reports; so, if you’ve ever had a credit card, a loan, a credit check, or even just a bank account, then it’s possible your personal information has been stolen.
A leak of this size reminds us all that we need to be proactive about protecting our identities. We did some research for you this week and here’s what we recommend to better protect yourself.
Set up fraud alerts or a credit freeze.
When a fraud alert is set, credit card companies are required to take reasonable steps to verify your identity before opening an account. They either need to request additional authentication documentation, call you, or ask “out of wallet” questions like what your current mortgage payment is or what address you lived at in 2011. You only need to make one phone call to set up a fraud alert good for 90 days at all three credit bureaus, then you have to call to renew it. In contrast, a credit freeze stops any new line of credit from being opened and prevents creditors from even seeing your files. While this makes it super effective against fraud, bear in mind it also requires you to call each of the three bureaus and prevents you from opening new lines of credit or checking your credit until you call to unfreeze the accounts. Placing a freeze costs between $5-$10 and another $5-$10 to unfreeze using a unique pin number (better not lose that!).
We believe that taking the above steps will provide you the protection needed. The real issue though is that you have to be disciplined about re-upping your alerts every 90 days or be willing to go through the hassle of unfreezing / refreezing your accounts every time you want to switch credit cards, etc. so these options may not be ideal for you.
Monitor your credit reports.
Many online banks and account aggregators like Mint, will give you a daily or monthly credit report. The scope of these reports varies by provider, with Capital One’s Creditwise providing all your latest inquiries and recently opened and closed accounts, to Bank of America who simply gives you your score. Many of these services may only track one bureau unless otherwise noted. If you do not use any of these services, the Fair Credit Reporting Act entitles all Americans to one free report annually from each of the three credit bureaus (you can request them here). But frankly, learning you have been the victim of identity theft nine months after the fact is not very useful and you are on your own to figure out how to clean up the mess. As such, we don’t think this sufficient protection but it is better than doing nothing.
Buy some protection.
If the work required to self-monitor is not for you, consider paying a service to do the work for you. Picking the right service however is hard. We took a good look at the leading services this week and our favorite pick is is IdentityForce. IdentifyForce comes with all of the functions we considered vital such as monitoring all three credit bureaus and assuming a limited power of attorney on your behalf in the event of a problem, saving you the many hours and the major hassle of calling federal agencies, filing affidavits, and in rare cases, hiring lawyers. IdentityForce’s UltraSecure+Credit package costs less than key competitors’ premium packages and offers a full lineup of website, transaction and credit monitoring for $20 per month (per adult). Child protection (their information can be vulnerable too!) is available for an additional $3 per month per child. Its website is sleek and intuitive with a client dashboard where you can monitor your account in one simple page and remove personal data from the web with a click of a button. Popular LifeLock is our runner up in ID theft protection, offering similar services as IdentityForce but with the ability to be more customizable and offers live rep support. Their plan will cost you $30 per month (per adult) and an additional $6 per child monthly. (Note: some people are hesitant to go with LifeLock due to a lawsuit in 2015 for failing to offer the security they advertised. However, in February 2017 LifeLock was acquired by major cybersecurity company, Symantec, and they claim that past problems have been fixed). If you aren’t looking to pay for a solution, Equifax is offering their product, TrustedID Premier, which includes credit file monitoring and identity theft protection complimentary for one year. However, given their very recent security breach, we say use this at your own risk.
Identity fraud is becoming more and more prevalent and it’s important to take proper precautions. We encourage you to find the solution that works best for you.