How to protect yourself from ID theft

Woman leaning forward and looking concerned as she learns about id theft Woman leaning forward and looking concerned as she learns about id theft Image:

In a Nutshell

If your personal information was exposed by hackers, you may want to consider placing a fraud alert or freeze on your credit reports. It's also important to keep an eye out for unauthorized spending on your credit cards and bank accounts.

Editorial Note: Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors' opinions. Our marketing partners don’t review, approve or endorse our editorial content. It’s accurate to the best of our knowledge when it’s posted.
Advertiser Disclosure

We think it's important for you to understand how we make money. It's pretty simple, actually. The offers for financial products you see on our platform come from companies who pay us. The money we make helps us give you access to free credit scores and reports and helps us create our other great tools and educational materials.

Compensation may factor into how and where products appear on our platform (and in what order). But since we generally make money when you find an offer you like and get, we try to show you offers we think are a good match for you. That's why we provide features like your Approval Odds and savings estimates.

Of course, the offers on our platform don't represent all financial products out there, but our goal is to show you as many great options as we can.

It’s easy to feel overwhelmed when it comes to identity theft.

You may not remember every store you’ve shopped at or all the websites you’ve visited, but thieves and hackers can strike anywhere and at any time.

While the following measures can’t guarantee protection against identity theft, there are ways to better safeguard your information and concrete steps to take if you believe you are a victim.

Let’s take a look at what the experts say:

      1. Check all your financial accounts for errors or suspicious activity.
      2. Enroll in a credit monitoring service.
      3. Place a fraud alert on your credit reports. 
      4. Consider freezing your credit.
      5. Alert the authorities.
      6. Always use strong passwords and be aware of information you give out.

1. Check all your financial accounts for errors or suspicious activity.

It’s important to stay vigilant against identity theft, and that means regularly checking for any suspicious transactions. And this is not just your credit reports. You’ll need to review bank and credit card statements as well.

If you find any evidence of fraud, reach out to the financial institution and to the credit reporting bureau (or bureaus) where you found the information right away. You can view your TransUnion and Equifax credit reports for free through Credit Karma.

You may also request a free copy of your credit reports from the three major bureaus —  TransUnion, Equifax and Experian — through the government-authorized site AnnualCreditReport.com.

Tax refunds are also targets for thieves, so be on the lookout for suspicious activity with your taxes, the IRS advises, such as receiving a tax notice from a job you never held. Consumer Reports suggests that consumers file taxes early to prevent someone from using your Social Security number to steal your tax refund or your identity.

2. Enroll in a credit monitoring service.

A credit monitoring service may be able to help if you’re concerned about identity theft, but note there is no guarantee that your identity won’t get stolen.

If you’re a Credit Karma member, consider enabling our free credit monitoring service (our article gives you step-by-step instructions on how to do this).

We can track credit reports on a daily basis and we’ll proactively notify you if there’s been an important change to your TransUnion and/or Equifax credit reports, such as a new hard inquiry.

Get free credit monitoring through Credit Karma

What’s important here is that a service can help you spot suspicious activity early and may even help you recover your identity after it’s been stolen.

3. Place a fraud alert on your credit reports.

If you believe you’re a victim, you may want to place a fraud alert on your credit report, advises the Consumer Financial Protection Bureau.

It’s free to place a fraud alert on your credit reports, and people do this even if they only suspect their information has been compromised. You’ll only have to contact one of the credit reporting bureaus for a fraud alert; that bureau is required to contact the others with your request.

Here’s how a fraud alert works: When credit card issuers and other lenders pull your credit reports, they’ll be notified that you may be the victim of identity theft and should contact you before opening an account in your name.

There are two types of fraud alerts:

Type of Alert

Details

Length

Initial fraud alert Requires that a “creditor take reasonable steps to make sure the person making a new credit request in your name is actually you. If you provide a telephone number, the lender must call you or take reasonable steps to verify whether you are the person making the credit request.” 90 days; will expire after
Extended fraud alert This is available only if you’re the victim of ID theft and you’ve filed a police report. You can also only do this once. Requires a “creditor contact you in person or through the telephone number or other contact method you designate to verify whether you are the person making the credit request.” 7 years

Source: Consumer Financial Protection Bureau 

4. Consider freezing your credit.

Another response would be to place a freeze on your credit reports. This locks your credit reports so that lenders cannot pull them and prevents new accounts from being opened in your name.

You must request this service from each credit bureau separately, and be sure to ask about fees. Here’s where you can request a freeze from each of the three major credit bureaus:

Experts also recommend that you keep an eye out for missing tax refunds and medical bills you don’t recognize.

Some parents are also electing to freeze, or “lock,” the credit reports of their minor children. Each one of the three major credit reporting bureaus has pages detailing specific processes and limitations. Here they are, but note that the circumstances under which a parent can freeze the credit report of their children may vary by state:

Equifax minor child warning
Experian protected consumer process
TransUnion protected consumer process

You can also consider freezing your credit report with Innovis, a lesser-known credit reporting agency, and ChexSystems, a reporting agency for checking and savings accounts.

5. Alert the authorities.

If you are a victim of ID theft, you’ll want to file an identity theft report with the Federal Trade Commission (FTC) at identitytheft.gov or by phone at 1-877-438-4338.

The FTC site walks you through a three-step process: describe what happened, receive a recovery plan and learn ways to take action on that plan.

Next, the FTC advises victims to alert their local police departments with the following items:

  • A copy of your FTC identity theft report
  • A government-issued ID with a photo
  • Proof of your address, such as a utility bill
  • Any other proof you have of the theft, such as a bill or an IRS notice
  • FTC’s Memo to Law Enforcement

(The last link opens to the letter in PDF form.)

6. Always use strong passwords and be aware of information you give out.

You probably know not to use “password” or “12345” as your password for accounts with sensitive information.

But experts also recommend you avoid using your personal information, such as your name or birthdate, in your password. You should also avoid using dictionary words.

Consider creating a diverse, complex password or passphrase with uppercase and lowercase letters, numbers and symbols.

Better still, a password manager can generate, store and input complex, secure passwords for you, almost like an online gatekeeper.

Also, experts strongly recommend that you use a new password for each website. That way, if there’s a data breach and hackers steal your password for one account, they don’t have access to all of your accounts.

Learn more about creating strong passwords

Further, only enter your financial or personal information on a trusted, secure website, and never share your information in response to an unsolicited request. Also, ID theft isn’t always online — thieves can target your mail or skim an ATM.

Credit Karma has also created another way to help you detect identity theft.

With the ID monitoring feature, you can use your email address to search for any accounts that are in any public data breaches. If your information has been exposed in a breach, we’ll let you know some tips and tools to help you take the right next steps.

Sign up for Credit Karma's free ID monitoring service

We’ll also continue to monitor your identity and credit for free.


Bottom line

Identity theft is an unfortunate fact of modern life. The most recent government data by the National Crime Victimization Survey/U.S. Bureau of Justice Statistics show that 7% of U.S. adults 16 or older have been victims of identity theft.

So while it’s a good idea to use strong passwords and to check your credit reports regularly, it’s just as important to know how to respond when identity theft happens to you.

“You can’t prevent yourself from being a target,” says John Ulzheimer, a credit expert and president of The Ulzheimer Group. “Everyone’s a target. It’s just a matter of reducing your exposure and making it more difficult for the fraudsters to be successful.”