With all the talk in the media about identity theft and credit card fraud, many companies are selling identity theft insurance and credit monitoring services.
But are these ‘services’ worth your hard earned money? Maybe people just assume that identity theft insurance will protect them and that credit monitoring services will prevent identity theft. This simply is not true and while we can all reduce the risk of identity theft, there is always a small chance that it could happen to any of us. For most people, these services are a waste of money.
The fear of having one’s identity stolen or credit cards compromised is the biggest selling point for companies advertising these services. But in reality the average person can take a proactive approach to their financial life and identity and with little to no money take steps to monitor and watch out for suspicious activity.
Some of the ways to protect yourself:
Free credit reports
The federal government in the United States mandates that every person is eligible to receive a no strings attached free credit report at least once every 12 months from the 3 major credit bureaus. Using this free credit report you can check up on your credit history, look for opened accounts or loans in your name, check for errors , and more.
Some credit card issuers will offer cardholders free premium credit reports for no extra cost that allow you to also see your credit score.
Monitor your accounts
Most of these credit monitoring services do what you can do yourself, they just charge you for it. Keeping an eye on your credit card statements and bank statements can go a long way to protecting yourself.
Plus with online banking you can practically see your credit card transactions and bank transactions in real time, you can alert the bank to suspicious activity before it wrecks havoc on your identity and credit.
In fact some banks and credit card issuers will monitor accounts for unusual activity such as out of the country transactions or unusually large purchases and alert you immediately. All the credit monitoring companies do is access that information then pass it on to you.
Chances are if you have a credit card that you use for most of your purchases, you won’t be held liable for any unauthorized purchases. Again, by monitoring your credit card accounts and bank accounts on a regular basis you can act quickly in the event of unauthorized use.
Shred or Burn
Destroy any personal documents with sensitive information such as social security numbers, account numbers, and any other information that could be used to steal your identity. Get a shredder to shred documents before throwing them out or if you have a fireplace, burn the documents when you are finished with them
The same holds true for any credit card applications you may receive in the mail as well. This is one of the biggest areas of credit fraud and identity theft.
Why pay for someone else to do what you can do yourself? If you want to see your credit reports more often then once a year you can purchase them anytime for far less then you’ll pay monthly to these companies claiming to insure against ID theft or do monitoring of your accounts and information. Being proactive in protecting your finances and your personal information is the best way to minimize your risk of becoming a victim.