There’s a good chance you’ve heard about the recent data breach at Equifax, but what does it mean for you? Here are some action steps you can take.
There’s a good chance you’ve heard about the recent data breach at Equifax, one of the nation’s three major credit reporting bureaus. Unfortunately, if you have a credit history, there’s also a good chance that you’ve been personally impacted. The breach, announced by Equifax on September 7, 2017, impacted approximately 143 million Americans.
Hackers gained access to peoples’ addresses, Social Security numbers, driver’s license numbers, and birth dates. It was also reported that credit card numbers for over two hundred thousand consumers and documents with personal information for another one hundred eighty thousand people were hacked. Even the personal information of certain UK and Canadian residents was accessed illegally. The data breach occurred between mid-May and July 2017.
Identify theft and information leaks are in the news constantly, and as someone who has been personally impacted by this and other scandals, I get it if the headlines make you queasy. The reality is it’s essential to be proactive and ensure your personal information is secure, especially after a hack of this magnitude. So after you’ve had the chance to take a deep breath and roll your eyes at yet another scary headline, read on to learn some recommended steps to take to safeguard your data against potential threats.
Step 1: Find out if you’ve been impacted
Go to Equifax’s website and follow the instructions to learn if your information has been hacked. Because you will be asked to input the last six digits of your Social Security number, make sure you are on a trusted computer and secure internet connection.
Step 2: Safeguard your credit information
If you’ve been impacted, or simply wish to add stronger security measures to your credit account, there are a few different actions to consider. The first is to add a 90-day fraud alert to your credit report. Should your personal information be used to apply for a new line of credit, this alert will tell the credit grantor (i.e. financial institution, credit card company) to verify the identification of the applicant before extending any credit. To add the alert, first create an account with one of the three major credit bureaus (TransUnion, Experian, or Equifax). It doesn’t matter which, as the alert will be shared and applied across all three reporting agencies. After you’ve made an account, follow the prompts to add a 90-day fraud alert. This feature is free and the entire process only takes about five minutes. This alert will also add a promotional suppression to your account, so you won’t receive any credit card offers or solicitations while the alert is active. Once the alert expires, you can choose to repeat the process and add a new one.
As a more extreme measure, you can elect to freeze your credit. A credit freeze, also known as a security freeze, essentially seals your credit report and prohibits anyone from accessing or using your personal information to establish new loans or lines of credit. Before taking this step, be mindful that there may be a small fee for this service, and according to Experian, the freeze may “delay, interfere, or prohibit” the timely approval of any legitimate requests or applications you may make. Basically, if you add a freeze and then need to use your credit to obtain new financing, you may be forced to jump through some hoops or even pay additional fees.
If this protective step is of interest to you, freezes can be completed online and are not shared across reporting agencies, so you would need to add it to your account with each credit reporting agency. Links are provided for Equifax, TransUnion, and Experian. There is also information on each bureau’s website on how to request the freeze over the phone or through US Mail.
Note: Credit freeze services are free to identity theft victims and as a result of the hack, Equifax is offering their premium service free for a year to consumers with a U.S. Social Security number. Read the fine print on their product here.
Step 3: Monitor your credit regularly and remain vigilant with your online activities
There are some easy-to-adopt best practices related to your credit security. For one, sign up for CreditKarma to view and monitor your credit score. Using this free service does not impact your score, and their website makes it easy to assess how you’re doing in the various areas that make up a credit score as well as review recent activity. CreditKarma also has a free monitoring service that you can opt in to. (Not sure how credit works? Check out our online course dedicated to credit tips and tricks).
Run your full credit report annually using annualcreditreport.com and check for any errors or fraudulent activity. You can access your full credit report for free once per year from each major reporting agency. To be extra vigilant, consider staggering these reports, alternating between the major credit reporting agencies every four months.
Always check your bank and credit card statements to be sure there are no fraudulent transactions. Most banks also have added security features you can opt in to. For example, an email notification is sent for any transactions that post to your credit card in excess of $100. The added layer of security can help you easily identify when something looks amiss, and provide peace of mind.
Avoid using debit cards for online purchases to the extent possible. When a debit card is hacked, the money is pulled from your account, and it could take weeks to be refunded by the bank. When a credit card is hacked, on the other hand, the fraudulent charges are usually reversed within a matter of days, sometimes before they even post to your account. While being hacked is always a headache, using a credit card means your precious resources won’t be tied up while things are resolved.
And lastly, be diligent in changing your passwords and avoid using bank apps and websites on unsecured, public wi-fi networks.
Ariel is a CERTIFIED FINANCIAL PLANNER™ professional who believes that good financial advice starts with asking the right questions and determining how each Grownup personally defines success.
Any third-party resources or websites referenced above are not under Society of Grownups control. Society of Grownups cannot guarantee and are not responsible for the accuracy of the resources, websites, or any products or services available through such resources or websites.
While Society of Grownups hopes the information is useful, it’s only intended to provide general education. It’s not legal, tax, or investment advice, and may not apply or be useful to your specific financial situation. If you need recommendations geared to your personal financial situation, schedule time with a financial planner professional.