Each year, more and more Americans fall victim to some form of identity theft or fraud. In 2023, Americans reported they were the victims of more than nearly $10 billion in financial fraud. With fraud increasing in frequency and intricacy, it is more important than ever to stay vigilant and take steps to protect your financial security.
One step you can take to protect yourself from identity theft is to freeze your credit. Having your credit frozen helps prevent unauthorized parties from accessing your credit report and opening new accounts in your name.
To freeze your credit, you would need to create accounts with the three major credit bureaus:
Equifax, Experian and TransUnion. Once you’ve created these accounts, you can put the freeze in place. Should you need to apply for credit at any time, you simply call or log back into these accounts and request the freeze to be lifted either temporarily or permanently. Choosing a temporary lift allows you to put a specific time frame on the “thaw” and have the freeze automatically put back in place once that period has lapsed.
Freezing your credit does not impact your credit score, and is a free service provided by the credit bureaus. One important thing to note is that when freezing or unfreezing your credit, you will need to verify your identity. This is often done using a PIN number that you create or receive by mail. Should you misplace or forget this number, it will be increasingly more difficult to verify your identity and manage your credit accounts.
In addition to freezing your credit, there are a variety of other steps you can take to help make sure your identity is protected.
One example of this would be to closely monitor your financial accounts. Consider a credit-monitoring service to ensure no one is using your personal information. While credit-monitoring services do not prevent identity theft from occurring, they can provide crucial support if, or when, an issue arises.
Fraud alerts can also be set up so creditors will need to contact you before changes can be made to your existing accounts, or new accounts can be opened.
While protecting your credit is essential, the potential for someone to misuse your identity to open new bank accounts, obtain passports or receive medical treatment in your name, can also have long-term effects that are more difficult to resolve.
It is incredibly important to remain vigilant with your credit, identity and other financial accounts, as criminals are constantly changing their tactics to keep up with new technologies and platforms. There are many resources available to help you protect yourself and speaking to a financial advisor can help you understand the appropriate measures to put in place for your situation.
Katie Geery, MBA, CFP, APMA, CRPC, is a private wealth advisor and certified financial planner practitioner with Rise Private Wealth Management, a private wealth advisory practice of Ameriprise Financial Services, LLC in Bedford, NH. She specializes in fee-based financial planning and asset management strategies and has been in practice for six years. She can be reached at 603-606-4255, or Katie.Geery@ampf.com.
