What Are Ways to Protect Yourself From Identity Theft?
Did you know that 1 out of every 20 Americans has been victimized by identity theft at least once? Almost $17 billion was stolen from Americans through identity theft in 2019. That estimate is a 13% increase from 2018. The problem of identity theft is only worsening. So, what kinds of identity theft protection can you undertake to protect yourself?
The hard truth you must face is that identity thieves are enabled by your own ignorance or negligence when it comes to protecting your financial data.
The best identity theft protection measure is to always protect your personal finance information actively.
Identity thieves always need you to steal your identity.
How Identity Theft Protection is Enabled
The best way to explain identity theft protection is to first explain identity theft.
Identity theft is also known as ID theft or identity fraud. It is the fraudulent, deceptive and criminal practice where someone impersonates you via online or paper application processes for financial gain.
Identity thieves do not have to use Tom Cruise-like data hacking tactics that you might see in an action thriller film.
An identity thief can use very common and deceptive means to steal your financial data. And the sad truth is that your own negligence in protecting your personal financial data enables them.
Do you throw your ATM receipts on the ground or in nearby wastepaper basket when you withdraw funds?
Are you in the habit of throwing your paper bank account, Social Security or health insurance statement in the garbage?
Identity thieves can collect ATM receipts or financial statements from garbage cans and then turn that data into financial gain later.
Do you leave your wallet in a jacket or purse unattended in a doctor’s office, school, or church? Identity thieves can steal or quickly copy your financial data is the moments you leave them unattended.
One Portland, Oregon identity theft syndicate used such tactics to steal over $200,000 in 2019.
21st century purse snatchers may be more interested in the financial data they find after the theft than the money.
Once identity thieves have just a few data points of your financial information, they make money at your expense in a variety of ways.
How Identity Thieves Can Ruin Your Personal Finances
All identity thieves need to benefit is your name, address, date of birth, Social Security number, some bank account details, or details about your insurance policies.
An identity thief can open multiple bank accounts in your name, withdraws funds, and leave you to deal with the fallout.
Or they can apply for credit cards using your I.D. and credit history and make charges or cash advances at your expense.
Some identity thieves can use your identity to get themselves health insurance and medical care while impersonating you.
The savvier identity thieves can even use your Social Security information to steal your tax refund check.
If you have a great credit history, an identity thief may even take out a personal loan while impersonating you.
An identity thief can use your stolen I.D. and financial information to pay for their utilities.
After your identity has been stolen, it’s you who will face the consequences. You will have to contact the police and financial institutions to prove the theft occurred.
Meanwhile, your credit history could be adversely affected. Depending on your circumstances, you may have to pay or sue to get out of paying for the damages caused by identity thieves.
Identity thieves only need ATM receipts, bank account statements, and other financial information thrown in the trash to ruin your life.
Here are some identity theft protection strategies you should use to protect yourself.
Don’t Carry Paper Checks With You
If you are still writing out paper checks in 2020, welcome to Earth time traveler!
All kidding aside, there are just too many ways for the information on a check to be used against you by an identity thief.
Imagine that you will use a check to pay for purchases in a retail store. You must consider that after turning over that check, multiple employees will handle it before it is stored and later cashed.
Anything can happen during that chain of custody, like data theft from that check. The actual check does not have to be stolen for your identity to be stolen.
Your signature, address, routing, and account number are on that check. You may be asked to provide additional I.D., like a driver’s license or document with your date of birth on it.
Once an identity thief has those personal financial data points about you, stealing your identity is child’s play.
A good identity theft protection measure is to give up on paper checks/
Don’t Carry Too Many Credit Cards With You
Credit cards and debits cards are money. Carrying every credit card or debit card you own is like carrying hundreds, thousands, or tens of thousands of dollars on your person.
Do not get in the habit of carrying every credit card or debit card you own when you leave the home.
Every time you take out a credit card in public, there is a chance you can drop it or your receipt after using it.
Each time you take multiple credit cards in public, there is a chance you can lose them or have them stolen from you.
The best identity theft protection you can undertake is to only take the credit or debit cards you need when you leave the house, not all of them.
Don’t Ever Carry Your Social Security Card
When was the last time you ever had to take your Social Security card out of your wallet or purse?
Most of us keep our Social Security cards in our wallet or purse out of a sense of habit than utility. You may have forgotten that you carry it.
You have your Social Security number memorized, so don’t carry it with you as an identity theft protection measure.
Never Leave Your Wallet or Purse Unattended
If you go to a doctor’s visit, meeting, or visit anywhere you may hang up your coat, keep your wallet or purse with you.
Identity thieves are not all suave computer hackers waiting to compromise your computer. Most identity thieves are opportunist criminals.
Invest in a Paper Shredder
It’s the 21st century. Save a few trees and switch to e-statements for your bank and credit card statements.
If you prefer to receive monthly paper statements, invest in a paper shredder. Shred every financial document when you are done with it.
Do not throw credit card or bank statements into the garbage. If you do that, you may as well as post your sensitive financial data on a community post board.
Identity Theft Protection
Guard your personal financial data as if it was money. There are many websites where you can learn tips on personal identity theft protection.
Remember – identity thieves require your negligence in guarding your financial data to steal your identity.
Don’t give them the chance.
Allen Francis was an academic advisor, librarian, and college adjunct for many years with no money, no financial literacy, and no responsibility when he had money. To him, the phrase “personal finance,” contains the power that anyone has to grow their own wealth. Allen is an advocate of best personal financial practices including focusing on your needs instead of your wants, asking for help when you need it, saving and investing in your own small business.