5 Steps to Protect Yourself After a Data Breach

Imagine returning from a weeklong vacation to find your house unlocked.  If you’re like me, your first thought would be, “oh no, did someone enter and steal anything?” Unfortunately, we do not get the same visual “cues” when our financial house is left unlocked.

The recent Experian data breach, just another in a long line of data breaches, reminded us how easy it can be for hackers to access locked credit reports and query your credit score without your knowledge.  With the stolen information, hackers open credit cards and lines of credit in your name.  When they don’t pay the bill, your credit is damaged.

So, just as you would look around after returning home to an unlocked house, you need to “look around” your credit report.

Step 1:  Obtain copies of your credit report.  To check your credit report, the Federal Trade Commission recommends visiting annualcreditreport.com.  This is the only service authorized by federal law to provide your free credit report once per year by the all three agencies: Equifax, Experian, and Transunion.  Beware of impostor websites!

Many banks and credit card institutions provide free credit reports (and credit monitoring) from each of the above agencies, so check if any such services are available to you. Additionally, as of 2020, Equifax has allowed everyone in the US to obtain six free Equifax credit reports every year until 2026. This is in addition to the free annual report at annualcreditreport.com.

Step 2:  Check for newly opened credit accounts.  When looking at your credit report, you will first want to note any new lines of credit that have been opened.  These are usually found towards the top or the beginning few pages of your credit report.  Identity thieves tend to open credit cards or personal loans in someone else’s name and then fail to pay the lender, which ruins the victim’s credit.

Step 3:  Check your existing credit accounts.  Next, take note of all existing lines of credit to ensure the transaction and payment histories accurately reflect your situation.

Step 4:  Report any problems.  If you find any errors in new or existing credit accounts, report them.

Step 5:  Repeat Annually!  While it’s especially important to check your credit report in the wake of major data breaches, we encourage you to check your credit reports on a regular basis.  Set a reminder to request your free reports on your birthday or some other day that is easy for you to remember. The more proactive and informed you are about your credit, the harder it is for hackers and identity thieves to assume your identity.

If you need assistance or have further questions, we are here to help! Without a doubt, your advisor plays an instrumental role in helping you prepare yourself to meet your financial goals, but always remember that nobody can take a greater interest in your financial wellness than you.