23 Ways to Prevent Identity Theft
Are you setting yourself up to become the next victim of identify theft and don’t even know it? Here are 23 ways to make sure you won't be.
1. Collect your mail in a timely manner
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All those brochures, catalogues, and unsolicited credit card offers filling your mailbox may seem like junk, but that information is like striking the jackpot for identity thieves. The Federal Trade Commission’s complaint files from 1999-2001 reveal that 9% of people who knew how their identity was stolen blamed mail theft. Have a neighbor pick up your mail if you’re going out of town (or request the USPS to hold the mail), and if you don’t receive important financial correspondence, consult your bank as soon as possible.
2. Get a shredder for documents with your personal info
We tend to think of identity thieves as hackers sitting behind computer screens halfway across the world. But many thieves are closer to home, using simple methods to get your most precious asset (what sets you apart from everyone else — your name). A common practice is dumpster diving, i.e., going through your trash to find bank account numbers, your maiden name, birth date, and address, which can be used to open false accounts in your name.
Stephen Massey, a notorious identity thief, directed a large-scale identity theft ring and used this exact method to obtain personal information about his victims and ruin their credit. Shredding documents that contain your personal information will ensure that your personal information doesn’t end up in the wrong hands.
3. Stop junk mail
Identity thieves can steal preapproved credit card offers from your trash, change the address, and apply for the new credit card under your name. Just like with other sensitive mail, you should shred these offers before throwing them out. If you’re inundated with credit card offers, you can opt out by writing to the Direct Marketing Association so that your name will be taken off the direct mail mailing list.
4. Store sensitive information in a safe place
Your home should be your sanctuary, but on the unlucky chance that you experience a home robbery, you should worry about more than just your stolen TV. Think of all the documents you might have lying around your home that have personal information. You may have bank statements, expired driver’s licenses, credit cards, your Social Security card, and passwords on Post-its right out in the open. All of that information can be used by criminals to access your accounts or create new accounts in your name. Your sensitive documents should be stored somewhere secure, preferably in a safe. If you experience a home robbery, take notice of what may be missing from your home besides technology or cash.
5. Don’t share financial info with other people
In a perfect world, we’d be able to trust relatives, friends, coworkers, and romantic partners with our most guarded secrets and financial information. Unfortunately, identity theft statistics show that quite a few victims were betrayed by somebody they knew. A 2005 report published by Graeme R. Newman and Megan M. McNally for the U.S. Department of Justice revealed that 14% of people who knew how their information was compromised believed it was obtained through “other” means, which include theft by people who had access to their information. Another report, compiled by the Federal Trade Commission, estimated that 11% of victims knew the offender. Rather than putting your personal information (and relationships) at risk, keep your financial information under lock and key.
6. Protect your computer
If you’re checking your bank statements, buying Christmas gifts, and filling out your FAFSA online, you want to make sure that your computer is secure. Not only do those activities involve sensitive information like bank account numbers, passwords, and credit card numbers, but they also involve personal information like your name, birth date, SSN, and mailing address, all of which are useful to identity thieves.
The Identity Theft Assistance Center (ITAC), a consumer advocacy organization, conducted a survey of identity theft victims. They estimated that 21.6% of the reported cases in their 2012 study were because of computer-related identity crime, but other experts suggest that the percentage is much higher. Updating your firewall and downloading antivirus software and spyware will help keep your computer secure. You can take extra precautions with your PC by deleting any personal information from your computer before throwing it out, selling it, or sending it in for repairs.
Read Our Review: What's the Best Antivirus Tool?
7. Have secure online passwords
Having a fully protected computer but shoddy passwords for your online accounts is like having a state-of-the-art home security system but leaving the door unlocked. All too often, people are willing to share the key. In fact, more than 3 in 10 people share their password with a friend, a CreditDonkey survey about identity theft revealed. And many of us have weak passwords that make it easy for identity thieves to be successful.
In 2013, millions of Adobe users’ personal information was jeopardized by a security breach, but even more shocking was the simplicity of users’ passwords, like “123456” and “password.” Seriously? Even without the security breach, users with such simple passwords are putting themselves at risk. Using a password of at least eight characters and with a mix of numbers and letters will protect your account and make it less vulnerable.
8. Use different passwords for online accounts
Nearly one-third of respondents to a CreditDonkey survey told us they use the same password for multiple websites, a habit that is asking for trouble. Even with a bulletproof password, you shouldn’t use the same one for all your online accounts. All of them should be different — your Facebook, bank account, email, and even your Amazon account should be unique. If you have a hard time remembering all the different passwords, write them down in a safe place, or make similar, but unique, passwords for each type of account.
9. Only shop on secure websites
Stop right now and check the web address of this page. What you don’t see is “https:://” preceding the URL. This webpage isn’t encrypted because you don’t have to input personal information. However, if you were to sign up for a product or service from one of our partners, you would be directed to a secure connection with “https://,” which indicates that your personal information is safe from third-party viewers.
Javelin Strategy & Research, a market research company, stated in its 2014 Identity Fraud Report that 44% of all identity fraud in 2013 involved an online transaction. Such transactions can include anything from purchasing airplane tickets to transferring funds to another account. While there are various ways that your financial information can get stolen online, the very least you can do before conducting an online transaction is make sure that the website is encrypted. Many web browsers use a lock icon to the left of the web address to indicate that the connection is secure. But if the website can’t bother to encrypt their webpage, do you really want to trust them with your credit card information?
10. Don’t make purchases on public Wi-Fi networks
Given the above statistic, you should also refrain from conducting online transactions on public Wi-Fi networks. That hipster sitting next to you at the Internet café? He could be a hacker for all you know. If you check your account balance or purchase some new shoes at your local public library, anyone who is also connected and who has the skills and know-how can see your information and use it as they see fit. Save your personal transactions for your home computer or a password-protected Internet connection.
11. Monitor your online accounts
Your mother probably warned you to save your receipts, track your expenses, and double-check your bank statements, but we all neglect those tedious tasks more than we should. In a CreditDonkey survey, 56.3% of respondents admitted they do not track their shopping receipts. However, paying attention on a regular basis will help you catch any discrepancies that result from identity theft before they become a major problem. When your identity has been stolen, time is of the essence. A report published by the U.S. Department of Justice found it took an entire month for 29% of people who experienced identity theft to undo the damage.
12. Think twice before saving sensitive information online
With just a few clicks, you can review your Chase credit card statement, buy some last-minute Christmas gifts at Target, and upload some of your personal photos to iCloud. Sounds easy, right? The problem is, all three of those companies suffered data breaches in 2014. One breach can jeopardize thousands of accounts. Javelin’s 2014 Identity Fraud Report found that of the people who received a notice of a data breach in 2013, 1 in 3 people became victims of fraud. We’re not saying you should go off the grid just yet, but you should definitely make sure that you trust a website before you give up your personal information.
13. Beware of phishing
There are various phishing methods, but the most common are emails that request your personal information, deceptive links that require your personal information, or malware that records your keystrokes. A fraud report by EMC, the IT company, estimates that the number of phishing attacks increased in 2013, reaching nearly 450,000 cases in the U.S.
You can protect yourself from phishing by staying aware of the various phishing methods, verifying each website before entering personal information, and being wary of strange emails requesting your information. As it is, 81% of respondents to a CreditDonkey survey said they are “very cautious” when they get an email from an unknown sender, and 80% said they wouldn’t open a message from an unknown sender.
14. Be careful with personal information on social media
While everyone wants to share aspects of their lives with their social networks (and also convince them that their life is way more glamorous than it really is), we have to make sure that we’re not putting our own security at risk. Take a mental inventory of who’s on your friends list and think about if they really need to know your birthdate, maiden name, or vacation plans.
In 2011, the Javelin Strategy & Research group studied social media behavior and its relationship to identity fraud. They found that those who used social media had a higher incidence of identity fraud, and a large percentage of participants shared information that could be used to authenticate their identity. You can protect yourself by adjusting your privacy settings to control who sees what, or better yet, don’t share those types of things at all.
15. Be careful with your smartphone
In the same Javelin study, smartphone owners experienced a higher incidence of fraud. In fact, 7% of smartphone users were victims of identity theft, which is a higher percentage than those who don’t use smartphones at all. The study attributed the high percentage of fraud to users not updating their systems regularly, neglecting to protect their phones with a password, and saving login information on their phone.
Smartphones are meant to make our lives easier, but a lost or stolen one can make your life very complicated if you have your personal information on it. Be smart with your smartphone and personal information by password protecting your phone, logging out of accounts when you’re done with them, and avoiding unsecured networks.
16. Stay informed about phone scams
Most consumers know better than to give personal information over the phone, but phone scammers are becoming savvier, increasing the chances that you’ll ignore your instincts if you’re not careful and provide critical info over the airwaves. For example, a fairly new phone scam sends a text message pretending to be from a bank, which directs you to call a number and verify your identity. You can guess who it is on the other end.
The Federal Trade Commission reported that 3.2% of fraud that occurred in 2013 involved cell phones. Smishing, or phishing by SMS, is a new method of collecting victims’ information. It includes methods such as pretending to be from a financial institution and asking for your PIN, offering prizes in return for your personal information, and providing a link that may include dangerous malware.
17. Monitor your credit report
Some people are lucky enough to catch an instance of identity theft right away, but others aren’t so lucky. Aside from the financial consequences of identity theft, there are also consequences that affect your credit, reputation, and financial future. If a thief uses your identity to open bank accounts, make purchases, and incur debt, debt collectors may come knocking at your door and your credit score will suffer. Identity theft can affect your ability to apply for a credit card, secure a loan for a house, or even be hired for a new job.
Review your credit report every year to ensure that there are no discrepancies that could ruin your financial future. You’re entitled to one free report annually from each of the three credit bureaus (TransUnion, Equifax, and Experian) to see if there is anything questionable that has occurred under your name.
Bonus Tip: How to Review Your Credit Report
18. Protect your PIN
Your PIN numbers for your credit and debit cards are basically the only things standing between a potential thief and your hard-earned money, which is why you should be the only person who knows them. Under no circumstances should you keep a written record of your PIN in your wallet or with your credit card. If your wallet is stolen, you’ve pretty much given permission to the thief to wipe out your bank account as well as ruin your credit.
Also consider changing your PIN periodically and using a combination of figures — using the last four digits of your SSN or phone number is far too predictable for a seasoned identity thief. You should also be cautious of “shoulder surfers” when using your PIN at ATM machines and block your PIN from prying eyes.
19. Don’t have more credit cards than you can manage
If you’re the type of person who has more credit cards than you can count, you’re at risk of becoming a victim of identity theft. Maybe you applied for a store credit card to get 10% off your first purchase, or maybe you got a sweet sign-up bonus and quickly forgot about the card afterwards.
Open lines of credit, especially of unused credit cards, are frequently targeted by identity thieves because they know that the owner probably doesn’t monitor the account regularly. Every six months or so, take inventory of your credit cards and consider closing any that you haven’t used in over a year. Don’t close a bunch at once, however, as that could negatively affect your credit score.
Bonus Tip: How Many Credit Cards Is Too Many
20. Don’t use your credit cards at untrustworthy places
Nobody wants to be judgmental about businesses or store employees, but following your gut could save you from the headache of a stolen identity. In the ITAC victim’s survey, of those who knew how their personal information was stolen, 11.6% stated that it was because of corrupt businesses or employees. If you get a slimy feeling from your neighborhood corner store or the clerk who’s going to handle your credit card, pay in cash or opt out of making the purchase at that time. You might feel silly, but at least you’ll have the peace of mind that your financial information is safe.
21. Limit the items you carry around
Before leaving your house, ask yourself if you really need everything that’s stuffed in your purse or wallet. For example, do you really need three credit cards, two debit cards, your library card, checkbook, Social Security card, and driver’s license everywhere you go? If your wallet is stolen, all of your personal information is now in the hands of a criminal.
In the ITAC victim’s survey, 15.1% of respondents who knew how their identity was stolen reported that they had lost their wallet or that it had been stolen. Your wallet should carry just the essentials — your ID, cash, insurance card, and the credit card you’ll be using that day. Not only will your purse or pocket feel lighter, but you can rest easy knowing that should you lose your wallet, the thief will have limited personal information about you.
Bonus Tip: What to Do When You Lose Your Wallet
22. Protect your loved ones’ identities
Unfortunately, your loved ones may also be at risk and may have no way of defending themselves. Children, the elderly, and the deceased are common victims of identity theft. The elderly are frequent targets because they may not be aware of phone and Internet scams, which is why it’s important to inform your relatives and review their credit reports if they are unable to do so themselves.
Children are also common victims because their lack of credit history makes it unnecessary to review their credit reports, which means that identity theft can go undetected for a long period of time. In the 2012 Child Identity Fraud Report by Javelin Strategy & Research, 56% of survey respondents reported the theft or misuse of their children’s Social Security number. Protect your child’s identity as you would your own.
23. Report suspected identity theft to the right agencies
If you suspect that you’re a victim of identity theft, you should report the theft to the appropriate agencies as soon as possible. You should first contact one of the credit bureaus, which will in turn report it to the other two agencies. They’ll put a 90-day fraud alert on your name so that it will be difficult for the thief to open a credit card in your name.
You should also contact any of the affected agencies having to do with the identity fraud. For example, contact the U.S. Postal Inspection Service if you suspect mail fraud, the IRS if you suspect tax fraud, your bank or credit card companies if you see suspicious activity on your account, or the Social Security Administration if you suspect that your SSN has been stolen. You should also file a police report at your local police department and file an Identity Theft Affidavit with the Federal Trade Commission.
It’s important that you keep all documentation relating to your case for future reference so that you can work with the credit bureaus to clear your good name.