Recently, hackers allegedly stole 2.9 billion Social Security records. Experts estimate the hack happened in April. But even if you haven’t felt any effects yet, that doesn’t mean you’re out of the woods. The hackers, part of a group called USDoD stole data that includes names, addresses, Social Security numbers, and relative relationships over the past 30 years. They are now selling that data on the dark web. That means we could see a prolonged uptick in identity fraud, hacking of financial accounts, and more. So how do you protect your identity and finances from fraud?
Luckily there are relatively easy steps you can take to protect yourself. Most of these steps require just a few minutes to implement! And together, they work together to protect your identity much more robustly than taking just one or two of these steps.
Assess Your Risk
An easy way to check if your data has been exposed is to go to the website Have I Been Pwned. You can then enter your email address and check to see if your email has been exposed in a data breach. You can also check if your email was part of a “paste” to a publicly-facing website specifically for disclosing data.
This method isn’t foolproof. It can’t check for all data breaches that have ever happened, nor can it check for data breaches where the data isn’t now publicly available. Nevertheless, it can give you a sense of your risk and the steps you need to take to protect your identity. For example, I know that hackers exposed some of my data in at least one data breach. And, indeed, when I used Have I Been Pwned, it showed that my email address was exposed in one data breach the website knew of.
Freeze Your Credit
One of the biggest steps you can take to protect your identity and your finances is to freeze your credit. By freezing your credit, no one can open a credit card or loan or do anything else that requires a credit check. Unfortunately, that means that you also won’t be able to do these things until you unfreeze your credit. However, it’s easy to freeze and unfreeze your credit whenever you like.
To do so, create a free account or login at all 3 credit reporting agencies: Equifax, Experian, and TransUnion. On your account page, you’ll find a button that lets you freeze your credit. Your credit should freeze within one business day. You can unfreeze your credit at any time. Credit agencies must unfreeze your credit within one hour of your request. So you can easily unfreeze it if you apply for a credit card, loan, etc.
Change Your Passwords Regularly to Help Protect Your Identity
Additionally, change your passwords regularly, ideally every few months or more often to protect your identity. And avoid using the same password for a bunch of accounts, using common passwords (like “password”), or incorporating easy-to-find information about yourself in the password itself.
We’ve all seen those spy movies where the spy quickly cracks a password by being like, “What’s their kid’s name and the year they were born?” They then promptly hack into the allegedly very protected vault on their first try. Given that hackers got access to relative information in the recent leak, this is an especial concern for guessing passwords and security questions with family names in them.
If you’re like me (and, I think, most people), you don’t want to keep track of a million passwords. My brain has been filled up with 90s and 2000s music lyrics for years and I’m not planning on changing that situation. Instead, you can use password management websites like 1Password or BitWarden that securely store your usernames and passwords. You just have to remember the password for those websites!
For a free option (those websites usually require subscription fees), you can track your passwords on websites like Norton Password Manager and LastPass. Usually the free versions are very bare bones, but still super helpful. You can also DIY your password storage by tracking your passwords offline or in an encrypted file.
Enable Multi Factor Authentication to Protect Your Identity and Accounts
Multi factor authentication has become hugely popular in recent years and for good reason. A password is just one layer of protection. Hackers can still crack a complex password and/or a regularly changed password. Plus, a complex password won’t save you from a data breach if hackers immediately get access to the password itself. You can majorly enhance your security by adding another layer of protection.
That’s where multi factor authentication comes in. If you’re unfamiliar, the idea is that after you enter your password, you’ll be prompted to put in a temporary passcode that is communicated to you via text, phone call, or app. Alternatively (or in addition), you might receive a phone call that you then have to answer. You then have to correctly enter that temporary passcode and/or answer the phone call and press a button.
Consequently, if a hacker tries to log into your account, they won’t be able to get in with just your password because they won’t have access to the passcode that was sent to you. That’s assuming they haven’t also hacked your texts and emails or stolen your phone number through a SIM card switch. Complicated, I know. This highlights how important it is to protect yourself through multiple methods!
On top of that, multifactor authentication is a helpful signal that someone is attempting to hack your account. If you receive a passcode and haven’t tried to log in, there’s a good chance you need to change your password and call customer service. Keep in mind, however, that if you’ve linked your accounts to apps like budget tracking apps, you’ll sometimes receive these notifications due to an app refresh rather than a bad actor.
Enable Notifications on Your Financial Websites
Similarly, enable text or email notifications with your financial institutions. You can often set up particular types of notifications so that your bank or credit card company alerts you if they notice a large transaction or unexpected sign in. You can even sign up for notifications for every transaction on your account. Some people find that overkill, but depending on your preferences, it may help your peace of mind.
Regardless of the options you go with, notifications help you flag suspicious actions so you can call your financial institution and freeze your accounts.
Create an Account on the Social Security Website to Protect Your Identity
Everyone should create a free account on the Social Security Administration website. Even in the absence of fraud, doing so comes with a lot of benefits. You can see how much money you’ve made over time, request a replacement for your Social Security or Medicare cards, manage your disability and Medicare benefits, and so much more.
If you don’t create an account, someone else with your information can create one for you. This then allows them access to the very benefits mentioned above. They can mail themselves a copy of your Social Security and/or Medicare cards, manipulate your profile information, take advantage of your benefits, etc.
Creating an account is a relatively fast process. Just make sure you know your social security number and are able to verify your basic personal information.
Take Advantage of Free Credit Checks
Everyone is entitled to one free credit check per year for each of the 3 major credit agencies mentioned above (Experian, Equifax, and TransUnion). Those credit checks don’t affect your credit score. You can also sign up for an account with these agencies and often get access to real-time monitoring of your credit score. The same is true if you sign up for many financial apps and websites.
Plus, if you sign up for a free account with Experian, Equifax, or TransUnion, they often provide you with alerts if your score changes dramatically. A dramatic change in your credit with no major action by you can alert you that something fishy is going on with your financial accounts. That’s certainly not always the case. Credit scores can change for a variety of reasons (you can see my post on how to boost your credit score). Nevertheless, it can help you catch bad actors more quickly.
Set Up a Schedule to Check Your Accounts
I have a phone alert set up to check all my bank accounts every two weeks. It’s a great opportunity for me to review my spending and make sure I’m not over budget. It also gives me a chance to check for any charges I don’t recognize and so protect my identity and finances. It takes just a few minutes out of my day, but helps me feel more at ease with my security and finances.
Likewise, check your explanation of benefits and medical statements whenever you receive them. Many people become victims of medical identity theft. In this situation, people use others’ identities to receive medical care and procedures. Victims are then saddled with tons of medical debt and are on the line for paying medical bills if they don’t notice and resolve the issue. So look for any appointments, procedures, or doctors you don’t recognize. Don’t assume it’s a mistake! Immediately call your provider to assess the issue.
Scan Your Computer for Malware
If you don’t have antivirus software, get some ASAP! You can often get free antivirus software through your or a family member’s employer for free or a discount.
Alternatively, consider splitting the cost of antivirus software with friends or family members. Many subscriptions cover multiple devices and allow you to list multiple people as owners. Make sure to check for sales as well. Like any product, antivirus software goes on sale periodically, especially around traditional sale periods like Black Friday or Memorial Day.
For those with antivirus software, keep it updated and run scans for malware (malicious software) periodically. Ideally, your antivirus software will be able to remove any malware it detects. If it’s unable to, you may need to get professional help.
Remove Your Personal Information from the Internet
Additionally, consider removing as much of your personal information from the internet as you can to protect your identity. This doesn’t mean delete all of your social media profiles. However, it does mean removing your address, phone number, and any other information you wouldn’t want bad actors to easily access.
You can try to do this on your own by searching yourself, finding listings online with your information, and modifying your profile or contacting the company to have that information removed. You can also opt out of data broker websites. Data brokers are the people who sell your address and phone number to the companies that send you spam. DeleteMe has a great resource on how to do so.
A much easier option is to subscribe to DeleteMe, which constantly monitors personal information and removes it for you. This service costs around $10/month. However, it can save you massive amounts of time and virtually end those spam phone calls and letters. It also majorly reduces your risk of hackers stealing your identity or information.
Know Your Rights
Last but not least, know your rights if your accounts do get hacked. If thieves fraudulently charge your credit card, your credit card company should reimburse you for all those charges. Things get more complicated if hackers get access to your bank and/or debit card. In most cases, you can still get your money back. However, your bank may open up an investigation to ensure you aren’t trying to cover up your own expenses.
If someone steals your identity, you may want to consult a lawyer depending on the situation. For example, if you’re the victim of medical fraud or if someone steals your identity and commits a crime, you’ll often need a lawyer to resolve those issues. For any type of identity theft, you can check out the Identity Theft Resource Center. They have incredible resources that are available for free to victims of identity theft and they can help you through the resolution process.
Final Thoughts on How to Protect Your Identity and Finances from Fraud
It’s a big understatement to say that having your identity and/or financial information stolen sucks. It creates tons of hassle and can cost you financially. Even if you’re able to get any stolen money back, you might have other unexpected consequences. For example, many couples have attempted to purchase a house only to find that they don’t qualify for a loan because a hacker destroyed their credit months or years ago.
So spend an hour or so this weekend to protect your identity and finances. By following even just a few of these steps, you can majorly reduce your vulnerability.
I hope you found this article helpful! If you took any of these steps or have other tips for protecting yourself, let me know in the comments! Interested in related content? Check out my posts on how to find unclaimed money, the biggest money mistakes I made in my 20s, how to start a no spend challenge, and simple steps to take when the stock market is down.