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How to Protect Yourself from Identity Theft
Help protect your finances from identity thieves.
Identity theft happens every day and could happen to just about anyone. An estimated 1.4 million identity theft claims were filed with the Federal Trade Commission (FTC) in 2023 alone.
Even small incidents of identity theft may put your credit score and finances at risk. While it’s impossible to eliminate the risk of identity theft in today’s digital age, there are ways to help reduce your chances of becoming a victim.
Key Takeaways
Protecting your personally identifiable information like your bank account, credit card, and Social Security numbers may make it harder for a thief to steal your identity.
Your information may be vulnerable online, but using unique, hard-to-guess passwords for each site may make it harder for thieves to steal your information.
Be cautious about the types of information you share online and on social media sites as thieves could use it to access your accounts.
What Is Identity Theft?
Identity theft happens anytime someone steals your personal information like a bank account number, Social Security number, or credit card information and uses it for their own purposes. They effectively impersonate you and make purchases in your name, open new lines of credit or take out new loans and stick you with the bill.
If you’re not careful, those unauthorized actions could do serious damage to your credit score.
While it’s possible to repair your credit and recover from identity theft, doing so is difficult and time-consuming. Save yourself the headache and protect your information from thieves.
How to Avoid Identity Theft
While everyone is vulnerable to identity theft, there are a few things you could do to keep your information safe. Here are a few tips that may help reduce your risk of identity theft and protect your finances.
Use Complex Passwords
We know you’ve heard this before but it’s important to protect your accounts with complex passwords. Passwords should have a mix of upper and lowercase letters, numbers, and special characters. Avoid using personal info like your birthday or address.1
Complex passwords make it harder for identity thieves to guess them or technology to crack them. Changing a password from "kangaroo" to Kang@roohop2 significantly increases its difficulty to crack. A brute force attack would now take 63,000 years instead of cracking it instantly.2
If it is difficult to remember many difficult passwords, you could try using a password manager. These tools save your passwords and often are accessible on different devices.
Make Your Usernames and Passwords Unique
In 2023, cybersecurity company Yubico found around 39% of people used the same password for multiple accounts.3
Using the same usernames and passwords across accounts makes it easier for hackers to access them. Thwart them by using unique usernames and passwords for each account you have.
Avoid Unsecured Wi-Fi Connections
Unsecured internet connections put your information at risk because anyone could access and intercept your data. They may also monitor the information you enter on various websites if they have the necessary skills.
Make sure your home’s internet connection has a strong password in place. And when you’re accessing the internet away from home, use secured connections whenever possible.
When using an unsecured internet connection, avoid logging into important accounts, such as your bank, credit card, mortgage, or other loans. This may reduce the risk of anyone intercepting login information for financial accounts.4
Watch for Phishing Scams
When you get an unexpected email or text from a company or person you “know,” double-check the sender. Look at the actual email address, not just the sender's name to make sure it’s someone you know, not someone impersonating them.
Scammers create realistic fake messages to trick people into sharing personal information. If you receive an unexpected message claiming to be from one of your accounts, don't click the link. Instead, go directly to the company's official website to login.
Beware of Excessive Promises
Scammers often send emails promising rewards, money, or steep discounts to get you to enter your personal information.
Be cautious of emails offering great deals or contest winnings that you didn't inquire about since they're likely a scam. Don't click any links and contact the company directly to verify.
Other signs of scams include poor spelling and grammar in these messages. Emails from legitimate companies are typically error free.
Don’t Overshare on Social Media
Don't share personal details like your address, email, or birthday on these profiles because thieves could use them to their advantage. You may also limit who's able to see certain details.
Secondly, resist the urge to check in at your vacation spot. This signals to others that your house is empty, and someone might seize the opportunity to snatch mail from your mailbox. Speaking of mail, consider investing in a shredder and shred any documents with personal information before you dispose of them.
When connecting with others on social media, don't accept friend requests from people you don't know. And even if you recognize the person, ensure the profile is real and not a copy. Thieves have begun copying social media accounts and requesting connections with the same friend list. Once connected, they may have access to more of your information.
Password Protect Mobile Devices
Mobile gadgets such as your smartphone, smartwatch, and tablet are attractive targets for thieves. Without passwords or facial recognition on your devices, criminals could gain access to information like your digital wallet and card details.5
Final Thoughts
Protecting yourself from identity thieves doesn’t have to be challenging. Use these tips to help keep your information and your identity safe and sound.
Preventing identity theft is just one way of protecting your money and keeping your financial future secure. Check out ways to protect your wealth to learn how to help secure your finances now and into the future.