Why you shouldn’t pay for identity protection: What can you do instead?
Even under the best of circumstances, identity protection services are only able to provide a limited number of ways to protect against identity theft. The protections offered by these services only work at the level of the credit bureaus, which report on credit card, loan, and mortgage transactions. Things like obtaining fake driver’s licenses, receiving medical care under a false name, and giving a fake SSN to avoid arrest typically don’t go through the credit bureaus so identity protection services aren’t able to help.
No Identity Protection is Guaranteed
The problem with any sort of identity protection is that nothing is foolproof. Credit bureau protection only works if the agency that issuing credit goes through the bureaus. If they don’t, they have no idea that you’ve put protective measures in place, and they may go ahead and issue credit to an impostor.
It’s almost impossible to protect yourself against driver’s license or medical fraud because most state agencies and healthcare providers don’t run checks at all and assume the information is legitimate. You can also be a victim of fraud by a thief who steals your credit card number or bank account information. They then go on a shopping spree, and you only find out about it when you are missing funds or the card alerts. These types of transactions cannot be stopped by a protection service. Only constant vigilance and some proactive steps on your part can help to prevent identity theft, and even then, you won’t have a 100% guarantee.
Don’t Pay to Protect Your Identity
So if it’s so hard to protect your identity, what can you do and should you pay someone else to do it for you? The answer to your second question is “No”. You will get the same protection, and you’ll have more control. (And you won’t give out your personal data to another company which could put you at risk in the event their database was compromised.) Here are four of the main security measures that these services use and how you can implement them. Then I offer some ideas that go beyond their protection.
1. Set up a Fraud AlarmThis can be done for free. You can call the bureau or go to their website, and then answer the questions. It’s not necessary to talk to anyone. You don’t have to call the other bureaus, they will contact them for you. The alert lasts for 90 days, and informs credit issuers that you might have been a victim of fraud. They should ask for additional documentation or information before granting credit. The alert does not stop credit from being issued, but it can reduce the number of incidents of identity fraud if the issuer follows the instructions correctly. You can renew the alert every 90 days.
The way to do the fraud alerts are:
Experian: 1-888-397-3742
Transunion: They’ll want you to do it online. You can do that here.
Equifax: 1-800-525-6285. You’ll be asked to fill out an application.
2. Remove Your Name From Pre-Approved Credit Card Offers
Contact Opt-Out Prescreen or call 1-888-567-8688 (888-5-OPT-OUT) to remove your name from pre-screened credit card offers. Direct Marketer’s Association can help you remove your name from many mailing lists. Opting out of the DMA database, which is used by the majority of solicitors, will greatly reduce junk mail. You can find out the way to tell companies that you do business with you don’t wish for your data to be shared by reading their privacy policies. It usually works but it can take a while. When doing business online, make sure to uncheck all boxes that state “Contact me with future Offers” or similar. Many websites will pre-check this for you, hoping you won’t notice. They then leave it up to you to opt-out of their marketing messages.
3. Order and monitor your free credit reports
You’re entitled to receive one free credit report from each of the major credit reporting agencies: Experian TransUnion and Equifax. You get these reports through AnnualCreditReport.com
and should only use this site. Other sites that sound similar will charge you. Don’t ask for them all at once. You can ask for one report per year, from each service. This allows you to monitor your credit constantly. If you ask Equifax for a report in January, then wait until May before asking TransUnion. In September, request one from Experian. You can then request another Equifax report in January and continue the cycle. You can catch any potential problems faster if you check your credit report every four months. Keep important records
Keep your credit card number, bank account, insurance cards and driver’s licence information (and the contact information for each agency), separate from your wallet. Keep photocopies in a safe place separate from your wallet of any sensitive items you carry. If your wallet or purse is stolen, you can quickly contact each bank and card issuer and notify them of the theft so they can shut down your accounts and open new ones.
Other Ways to Prevent Identity Theft for Free
If you want to go beyond these services (and you should), here are other steps you can take to help secure your identity.Use a cross-cut shredder
Shred anything with your SSN, bank account numbers, address, or other personal information. Use a cross-cut shredder to destroy any documents that contain your SSN, bank account numbers, address or other personal information. Buy a “confetti” or cross-cut shredder, which will reduce your documents to small pieces that are nearly impossible to reassemble. Some shredders make strips which are too easy for a thief to put back together.
Freeze your credit
This isn’t free, but the peace of mind is worth it. This is like a fraud warning, except the lender cannot ignore it. A fraud alert is a simple notification to a lender that it may be possible that you have been the victim of fraud. They should ask for proper identification and verification prior to granting credit. A freeze, on the other hand, locks down your credit report so that you cannot view it unless and until you “unfreeze”. You will be charged a fee for freezing your credit, and another one to unfreeze your credit. If you are actively seeking loans, this is not the option for you. You’ll need to wait if you want to apply for a store card or a same-as-cash deal. Don’t let your debit or credit cards leave your sight.
It’s common for restaurants not to allow you to see your card and to make the payment in another register. Some servers will use a “skimmer”, which captures your card information, to make a fake card. You should bring cash to any restaurant where you are aware that your card will be taken. You should never let a clerk take your card from your sight. Some dishonest clerks will say they have to get manager approval of your transaction, then go to a back room and skim your card.
Be wary of ATM’s that look altered
Thieves will attach skimmers to ATM slots to capture card information and PIN’s. If you notice the slot is lumpy, not firmly connected to the machine or looks like there’s another piece of equipment attached on the front, be cautious. Don’t use the ATM if it looks suspicious. It is less likely that this will happen at bank ATMs, as they may be more vigilant in their checking. However, it can happen anywhere so be vigilant.
Protect your PIN
When at an ATM, cover the keypad with your hand and do the same as you tap in the information on pads in stores. You can avoid having to enter your PIN in a store by making the transaction “credit” instead of “debit”. It does not affect how you withdraw money; you simply do not have to enter it. You should always type in the website address directly into your web browser, and then navigate. If in doubt, call the company that sent the email or made the phone call and ask if it’s legitimate.
Spring for an unlisted phone number
Having an unlisted phone number cuts down on the number of phone solicitations you receive and cuts down on people just pulling a phone number and address out of the book and giving it as their own. It also cuts down on some junk mail solicitors that compile their lists from phone listings.
Don’t give out your SSN unless you have no other choice
Many places that ask for your SSN (except banks or those issuing credit) will accept another identifier if you ask. Some are willing to help you if they know about the problem of identity theft. Ask why someone wants your SSN and if they have an alternative. If you are not satisfied with their answer, you may want to consider whether you want to take the chance. Keep your identification paperwork at home until you get to know someone, such as a new friend or potential romantic partner.
Never carry your SSN around with you
Never carry anything in your wallet or bag that contains your SSN unless you need it immediately. It’s difficult to cancel credit cards or bank accounts if your wallet is stolen, but the situation becomes even worse if your SSN is included in the deal. While you’re at it, purge your wallet of any credit cards, insurance cards, or other identifying information you don’t use on a regular basis to cut down on the items a thief has access to.
Protect your computer
Install antivirus and anti-spyware protection on your computer to prevent anyone from installing malicious software that can capture your personal information or transmit it to another party. Check that the website is secure before you enter any personal information. Look for the “https” at the beginning of the web address or a lock icon on the browser window. Do not enter personal information on public computers in schools, libraries, coffeeshops, etc. Leave information off of your checks
Don’t include your SSN, your phone number or your driver’s license number when you fill out your check. In the past, it was recommended to include this information on your checks to speed up processing and verifying. Now, this information is only used by thieves to steal your identity. If the person taking your check asks for additional information, you can give it if you feel comfortable (but don’t give them your SSN — they don’t need that). Otherwise, do not provide any. You can monitor your account online if you wish. Use this to monitor your account daily or at least every other day for any suspicious activity. If you wait until the monthly statement, it may be too late. If you only wait for the monthly statement, you may be too late.
Sign up for e-billing and e-statements
Receiving bills and account statements electronically cuts down on the chances of someone intercepting your information in the mail, either through intentional theft or in the even your mail just goes to the wrong place.
Buy a safe
Keep sensitive documents (tax returns, bank statements, passports, Social Security cards, etc.) Buy a safe. A safe can keep your personal information from falling into the wrong hands if your home is burgled. You can also rent a safe at your bank, but it can be difficult if you are in a hurry and need to access the documents when the bank is not open. Keep documents no longer than you need to. You can shred or burn old statements, tax returns and bills you don’t need. You can get a decent safe on Amazon for less than $200. Here’s a popular safe. Find your local lock-and-key store to see if it has any vintage safes. This is a good and less expensive alternative. Anchor your safe to the ground. You could lose your safe to a former partner who is upset, to a criminal, or to a family member that has issues if they are not anchored.
Be cautious with your mail
Signing up for electronic statements and billing and opting out of junkmail will reduce your risk of identity theft. But you can do more. Do not leave important outgoing mail at your mailbox. You can easily lose it when you are not looking. It’s best to take it to the postoffice. You can either ask a friend to pick up your mail if you are going out of town or leave it at the postoffice. Do not let your mail pile up where thieves can easily access it. As soon as you can, retrieve your mail. When you return home, if you’re not home when your mail arrives, take it out as soon as possible. Do not leave it overnight. Consider a locking mail box. These are so mail deliverers can open and close them, but after that, you’ll need a combination or a key because it’ll reset for the next day’s delivery.
Don’t leave personal information out in the open
Each day there are more stories of contractors or delivery people who enter homes and steal the homeowners’ identities. They may have left their checkbook, an old bank statement or insurance claim that included their SSN out in the open. The contractor only needs to copy this information to be able to steal your identity. When you have contractor services or deliveries done, ensure that all compromising information is hidden and locked away. And be sure to keep an eye on the people who are in your home.
Bottom Line: You Don’t Have to Pay for Protection
Yes, you can pay a service to do some of these things for you, but if the protection you’re paying for is no better, or possibly worse, than what you can do yourself for free, why pay for it? You can protect your identity by taking some simple steps. Even companies who charge for protection cannot guarantee your identity. You may still be the victim of identity theft if you are a victim of a determined or savvy thief. Share your experience in the comments below. Share your experience in the comments section below.
