Kevin Michels, CFP^®, EA

Last Thursday Equifax, one of the three major credit reporting agencies in the United States, announced that due to a security breach, roughly 143 million American’s sensitive information had been stolen.

The sensitive information that was stolen included Social Security numbers, addresses, phone numbers, and in some cases driver license numbers.

With roughly 15 million identities already being stolen each year, this latest breach will inevitably increase the incidents of identity theft going forward.

Here are 3 steps you should take to secure your credit:

1. Find out if your information was part of the breach

Equifax has created a new website, equifaxsecurity2017.com, which will tell you if your information was compromised during the hack. Once you get to the website scroll to the bottom and click on the button that says ‘Potential Impact’, you will enter in your name and the last six digits of your social security number (if you feel uneasy giving sensitive information to an agency that already allowed that information to be stolen you’re not alone). A message will appear that will tell you whether or not your information was comprised. Here is the message I received:

"Thank you. Based on the information provided, we believe that your personal information may have been impacted by this incident."

I’ve read in other articles that some people have gotten different answers when checking their name multiple times.  In my own experience (I checked my name 3 times); I’ve gotten the same message each time.

2. Monitor your credit

On the same page the message appeared you have the option to sign up for 1 free year of credit monitoring through Equifax.  This free service seems pretty trivial given the fact that stolen information could be used 20 years down the road.  Luckily, credit monitoring is something you can be doing yourself, for free.  Annualcreditreport.com allows you to download a free credit report from each of three major credit agencies, Trans Union, Equifax, and Experian, each year for free.  That means that every four months you should be downloading a credit report from one of the agencies and scanning it to make sure everything on the report is accurate.  Make this a habit. I have a reminder set in my phone every four months to check my credit report; it takes me 10 minutes every four months.

If you find unauthorized credit accounts on your report immediately contact the credit reporting agency to place a fraud alert on your report.  You should also contact the Federal Trade Commission to file a report and receive guidance on what to do next depending on the type of fraud that has taken place.

3. Consider freezing your credit

A credit freeze makes it much harder for fraudsters to apply for credit in your name. Here is how it works:

When you apply for a credit card, a mortgage, or any other type of loan the company you are borrowing from will contact one of the three credit reporting agencies to check your credit. If you put a freeze on your credit the credit reporting agency will not supply the lender with your credit report. 

Eventually, when you need to apply for credit you can “thaw” your credit freeze using a PIN the credit reporting agency provided you at the time of the credit freeze.  Once the lending company has done their due diligence and accessed your credit report you can reinstate the credit freeze.

Make sure you freeze your credit at all three agencies.  It costs around $5-$10 to do so at each agency, but Equifax is offering a free credit freeze temporarily.

Regardless of this most recent data breach everyone should be mindful of the security of their identity.  Make it a habit to check your credit report and consider putting a freeze on your credit all the time. This wasn’t the first data breach (Yahoo, Target, Sony) and it won’t be the last so make it a habit to take on-going preventative measures to secure your identity.