It was frightening to learn that if you use consumer credit you may be one of over 145 million people who have had vital identity information stolen. Consumer Reports has a good article that has lots of details, but it boils down to the fact that the following sensitive information may have been compromised:
- credit card numbers,
- banking account information,
- social security numbers,
- driver’s license numbers,
- phone numbers,
Not only is this all very frightening, but it makes me feel really helpless when I think about how this information can be used to steal my identity, money and credit history. But fortunately, I think that there is something(s) that we can do.
First of all, I don’t think that anything Equifax is doing is going to help. They have set up a website that allows consumers to determine whether their information was potentially compromised, but many reports have been made that the results seem arbitrary. To be safe, I have to assume that all my information has been compromised.
Equifax has also given people that may have been compromised access to a free (for one year) service to monitor their credit. Sorry, I’m not buying into this solution! If it was free for life, I may have considered it. A much better solution is Credit Karma that offers a 100% free for life access to your credit records. The most important aspect of this service is that they will notify you if anything changes regarding your credit record. You can see if there have been any “Hard Inquiries” made to your credit, or if any new accounts have been opened. The downside of CreditKarma is that in order for them to keep their service free, they are ad based. They provide ads that are specifically targeted to you based on personal info and credit worthiness. This is the same scheme that Facebook uses to keep their service free.
The only legitimate complaints I have seen against Credit Karma is that the credit scores that they provide are not the same ones that may be reported to lenders. The lenders will get a FICO score whereas Credit Karma’s scores are called “VantageScore 3.0”, so at best, they can be used for reference. Here is what Credit Karma has to say about their credit scores:
VantageScore 3.0 is a credit scoring model. It takes the information in your credit report and turns it into a score. There are many scoring models out there, including ones from FICO and other companies. Each one calculates your score a bit differently, but they all use information from your report.
There are other online services that you can use to monitor your credit, the most popular of these is LifeLock. LifeLock offers paid plans at $10, $20 and $30 per month. Click here for a list of their offerings. Between LifeLock and Credit Karma, I have chosen Credit Karma and have created accounts for both me and Colleen.
The second thing I’ve done is to place a freeze on my credit data through all three reporting bureaus. A credit freeze simply tells the bureaus to not release information to potential creditors unless you unfreeze your data for them. In order to unfreeze your data, you must contact the bureau and supply a pre-assigned pin to verify your identity. After the potential creditor retrieves your report, you re-freeze your data. The process of freezing, unfreezing and re-freezing is not free in California, except for Equifax. TransUnion and Experion charge $10 for each event. Here are the websites that you can connect with to freeze your data:
- Experian – https://www.experian.com/freeze/center.html
- TransUnion – https://freeze.transunion.com
- Equifax – https://www.freeze.equifax.com
The third thing that I have done is to leverage the services that my banks and credit card companies offer to get warning messages for any unusual activities on my accounts. Most financial institutions offer email notification for transactions that exceed threshold limits that you can set, for example, if someone makes a cash withdrawal greater that $400, I will get an email. I use these in combination with regular review of transactions to monitor financial activity