Money Management

4 Tips to Protect Yourself From Identity Theft

Protecting yourself from identity theft is an important way to protect your finances. Identity theft can be disastrous to your finances, family life and credit score. If you want to one day reach your goal of financial freedom, you also need to protect yourself from identity theft. Here are a few helpful tips to help keep your identity safe.

Watch What You Share

Identity thieves use personal information like your social security number, name or birth date to open new accounts in your name. They can then use these accounts to rack up a lot of debt that they don’t intend on paying. If you are really careful with your personal information it will be more difficult for these thieves to steal your identity. You might even find that they target an easier victim instead. This can save you a lot of hassle and a lot of heartache. Shred personal documents before throwing them out, remove your name from preapproved credit card offers (1-888-567-8688) and be very careful when providing information online. Social networking sites can be a special area of concern, so make sure you are aware of what you share.

Create Strong Passwords

I know it is tempting to use the word password as your password, but this is a really bad idea. Avoid using passwords that are easy to decipher and avoid using the same passwords on every account. Using your phone number, social security number, significant other’s names or a series of consecutive numbers is not a good idea. Instead create unique passwords by using letters, numbers and symbols. Plus, once you create these strong passwords, don’t share them with others.

Don’t Keep Your Wallet in Plain Sight

While no one likes to think about it, your friends and family might be the ones to steal your identity. In about ¼ of the identity theft cases, information was originally obtained by a family member or a friend. Don’t keep your purse or wallet lying around at work. Put them in a locked drawer whenever possible. It is a good idea to do the same thing at home. Additionally you might want to consider password protecting your computer to keep roommates and house guests from accessing your personal information.

Monitor Your Credit Reports

You should also take advantage of your yearly right to review your credit reports. This is a free service that you are entitled to once each year. It won’t take that long and can alert you to potential problems before they spiral out of control.

There are many ways to protect yourself from identity theft and to take care of the problem once it has happened. Check out the FTC’s great resource on identity theft. After all why work on protecting your credit and your finances just to have them ruined by someone else?

What do you do to protect your identity from theft?


Comments (5)

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  • I try to do all 4 to prevent identity theft but I am sure it still can happen so quickly. One child asking more attention and making you leave your wallet on the store’s counter a little too long, running the same “strong” password for too many years, etc. Still, better trying than nothing!

  • My #1 way is to go electronic on all documents, and shred everything that has to be sent to me in hard copy format. The harder it is for someone get to your information, the better for you. And actually reading your bank and credit card statements will alert you to any strange activity rather than only waiting for a free credit report. Also using the postal office maiboxes rather than your own since it’s much harder to steal from, changing passwords fairly regularly,

    I recently had a situation with a couple of clients who were blindsided by identity theft and didn’t find out until we tried to file their tax return! Talk about a weird way to discover it, I had to write about it in Identity Theft Discovered Thanks to the IRS


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