I recently got an offer in the mail for 10% off of an identity-protection service. The cost of the service was $9/month for their basic plan and $22.50/month for their “ultimate” plan. This seemed very expensive to me. After going through their list of services, I was a bit underwhelmed. I suspected that some of their services could be obtained for free with a little work. After doing some research, I was amazed at how many of their services were available for free with a little elbow grease. Here’s what I discovered!
1. Enroll in free identity theft monitoring
Did you know that the Auto Club offers FREE identity theft monitoring?? It’s called ProtectMyID® Essential. Basically, they will monitor your credit reports daily to detect suspicious changes. If no threats are detected, they’ll send you an “all clear” email once a month. Plus, they give fraud resolution support and $10,000 worth of identity theft insurance (not sure how useful that is in reality, but hey, it’s free). This is one of the same services that those ID protection companies will charge you for every month!
If you’re not a member of AAA, you can still get Experian’s fraud alert protection for free.
2. Use credit card and banking alerts
Many banks and credit card companies allow you to set up alerts which send you an email if, for example, someone buys something over a certain amount of money.
3. Check your bank and credit card statements every month
While automatic credit monitoring is great, there is no substitute for you personally monitoring your credit cards and bank accounts. I have saved thousands of dollars over the years by catching fraudulent purchases early. I’ve had my credit card hacked twice, and my bank debit card hacked once. I know it’s not fun, but if scan your statements every month for suspicious activity, you can minimize the damage.
4. Check your free annual credit report
You are entitled to a free annual credit report, so be sure to check that as well!
Your Physical Mail
5. Remove yourself from mailing lists
One common way your identity can be stolen is from those credit card offers that you get in the mail. They can either be intercepted or fished out of your garbage. You can stop the major credit agencies from giving out your mailing address by signing up at OptOutPrescreen.com. You can get five years of protection by signing up online, or get lifetime protection by entering your info online and signing a form and sending it in. I opted for lifetime protection. All of this is free.
You can stop other junk mail for free by signing up at DMAchoice.org. There, you can opt out of receiving catalogs, magazine offers, and other junk mail. You can either stop all of it or select which companies to block. I’ve also used CatalogChoice.org in the past, but that service requires you to enter a code for the catalogs that you receive in the mail in order to block them. DMAchoice.org is much less work, and if it works, it will be GREAT. I signed up and will let you know what happens.
6. Use paperless billing
The less confidential paperwork you generate, the better. If your mailbox is unlocked (like in many residential neighborhood), it wouldn’t be very hard for someone to go around and pick up credit card statements. So, I use paperless billing whenever I can.
7. Deposit outgoing mail in a U.S. Post Office box
The same problem exists for outgoing mail. I place outgoing mail in a real U.S. Post Office mailbox, not in an unlocked home mailbox at the end of the driveway, or worse, on top of my condo complex’s mail boxes where anyone can pick it up!
8. Destroy confidential information before throwing away
For any junk mail that does get through to you, make sure to completely destroy any credit card offers and other mail with confidential info. I not only rip them up, but I throw away half of the ripped up paper in a different trash can so the pieces can’t be easily re-assembled. (Or even better, keep half of it and throw that away in next week’s trash). Do the same for any paper containing confidential information that you want to dispose of such as bank statements, tax forms, etc., and of course, old credit cards.
9. Keep mailing addresses up to date
When you move, be sure to update your mailing address with banks, credit card companies, etc. Register your move with the U.S. Post Office to cover anything you might have missed.
Online and Over the Phone
10. Use good passwords for online accounts
Your passwords should be at least 8 characters, with uppercase and lowercase letters, numbers, and symbols, if allowed.
11. Be paranoid about who you give your personal info
Don’t give out your personal info unless you’re sure of who you’re dealing with. I once got a call from “Mastercard” saying that my card had been hacked. The guy sounded a bit fishy and then asked me to turn over the card and give him my account number and security code. I hung up right there. Don’t give out your info unless you know who you’re dealing with. Beware of phone and email scams.
One more tip: in general, I don’t click links in emails that I get for bank or credit card statements. I have the bank’s website stored as a favorite in my browser and I click that instead. It is very easy to create a fake email that sends you to a fake bank website where you could enter your password.
12. Use antivirus software and keep it updated
Microsoft offers free antivirus software called Microsoft Security Essentials for Windows 7 which is actually quite good! No need to pay the ridiculous annual fees that other antivirus companies charge.
13. Avoid storing your credit card info on websites
Unless it’s an online store that I go to very frequently, I try not to store my credit card number on shopping websites.
On Your Person
14. Clean out your wallet, then scan it!
Number one, do not carry around your social security card in your wallet or purse. Number two, remove any unnecessary credit cards or items with identifying information. When you’ve pared down your wallet to the essentials, take your credit and ID cards, put them on a flatbed scanner, and scan the back sides to your computer. Then, if you ever lose your wallet, you’ll have all of the contact info ready to go. When your credit cards are stolen, time is of the essence, so if you can save a bit of time when cancelling your cards, so much the better.
15. Don’t use banking apps on your smartphone
I know it’s convenient, but the chances of getting my phone lost or stolen are just too high for my taste. I only do banking and manage my credit card accounts from my home computer, not my smartphone. Even if the app or website is password-protected, the bad guys now know which bank you use, as well as your phone number, and a lot of other info they can glean from your phone.
16. De-activate your debit cards for purchases
I use my bank debit card for ATM transactions only. I don’t use it for to make debit purchases. After my debit card got hacked a few years ago, I disabled my debit card’s ability to make purchases altogether by logging into my bank’s website, and setting the debit card max purchase amount to zero dollars. That’s one more potential vulnerability removed. Instead, I use credit cards to make purchases.
17. Cancel cards you don’t use anymore
A few months ago, I got a fraudulent purchase on a credit card I hadn’t used in years. I immediately called the credit card company, and happily, they took care of everything and I was not charged. But, it reminded me that every credit card you have adds risk of fraud, and that cancelling cards that you don’t use anymore is a good idea.
By using a combination of free services and a little bit of your own elbow grease, you can arguably do as good a job or better of protecting your ID as one of the expensive paid services. That’s what Consumer Reports says in fact! Here’s another interesting article from 20somethingfinance.com that basically says the same thing.
Tell us about your ideas and experiences! – Brian