financial advising, identity theft protection

Protection from Identity Theft in 5 Easy Steps

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By Sebastien Holmes

Identity theft is increasingly common and severe in today’s digital world. Although many organizations now provide services for credit monitoring, how can you make sure you’re adequately protected? Also, if you work with industry professionals (i.e., financial advisor, insurance professional, attorney, etc.), how can you feel your bank account, credit card, social security number and financial information is protected? 

You can take several steps to be proactive with your safety online, many of them fairly simple. Let’s look at five tips to help you with identity theft protection and preventing identity theft.

1. Free Stuff!

First, the most obvious piece of financial advice – make sure you are taking advantage of free credit monitoring services offered. Many credit card companies, credit unions and other institutions will provide these services at no cost. 

Although these services may not catch every vulnerability, they are worth setting up for ongoing monitoring of inconsistencies on your credit reports. Make sure you have the appropriate alerts set up to notify you of anything suspicious. This is one of our favorite pieces of financial advice to give: Take advantage of the free stuff!

2. Solid Passwords 

Next, make sure you have strong and complex passwords to protect your logins from ID theft. Ideally, you should create a separate password for each login to protect against identity thieves using compromised passwords from other domains. 

Make sure you are taking appropriate identity guarding measures to protect these passwords as well. Many websites and apps now have the ability to set up multi-factor authentication, which is strongly recommended as an additional security measure. 

When you log on to these platforms, a code is generated and sent to your cell phone or email address, which will need to be entered in order to give you access. This is one of the simplest and most beneficial layers of consumer protection you can add.

3. Protect Your Hard Copy

Make sure you are properly protecting and/or destroying documents with personal and sensitive information. For paper documents, like a Social Security card, financial documentation or bank statements from a financial institution, store them in a secure and locked location — ideally inside a fireproof and waterproof safe. 

Any documents that don’t need to be retained should be shredded. Electronic documents should be stored on a secure and encrypted server. When you are communicating personal info electronically (i.e., e-mails to your financial advisor or financial planner), those communications should also be encrypted, especially if they contain personal and confidential information like new account info, account numbers or credit card numbers. 

4. Put It on Deep Freeze 

In case you’ve been notified of any suspicious activity or compromised information through a data breach or potential identity thieves, you need to act quickly and diligently to protect yourself. This should begin by contacting the three major credit reporting agencies to freeze your credit reports, if you suspect you’ve been a victim of ID theft

You can begin the process online for all three:

Freezing your credit reports is a complimentary identity theft protection service through these credit bureaus. You will need to provide the reporting agencies with your personal information and set up a PIN for management of your freeze. Once the freezes have been set up, anyone with access to your personal information won’t be able to make debit card or credit purchases or open up new credit lines in your name. 

Moving forward, you can manage your credit freeze to allow legitimate requests to access your credit account history and eventually, remove the freeze altogether. You should also incorporate the important process of annual reviews of your credit report to proactively identify and resolve inconsistent or incorrect information. Each of the credit bureaus will provide you with an annual credit report at no cost.

Click here for Carson Wealth’s complimentary guide to family finance, “The Family Budget: Financial Empowerment at Your Fingertips”

5. Inform Your Professionals

Finally, you need to provide timely notice to organizations and professionals you do business with that you’re concerned about potential identity theft or compromised information. This is especially important notice to give your financial advisor, attorney, accountant in a timely manner. 

Since these professionals may have visibility and authority on your accounts, they will likely have procedures in place to provide you with enhanced identity theft protection. This could involve setting up a PIN or password to verify your identity when contacting them, or other additional layers of authentication to protect your information and assets.

It’s a Brave New World 

With the ever-increasing risks associated with financial identity theft, it’s important to be aware of these threats and what steps you can take to proactively protect yourself. These protections are largely available at no cost to you and can give you more confidence in your financial life. It’s also imperative to have a clear understanding of how to report identity theft or recover from identity theft if you’re a victim. 

It’s a brave new world and technological convenience often comes with criminal identity theft. Be diligent about your financial account safety, especially online, and discuss your financial safety and planning needs with your advisor and other professionals in your life. 

Let’s talk!

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