Losing money is never fun, but losing money through identity theft is particularly unpleasant. At iMoneyCoach we are not doomsayers,  nor do we want to scare anybody into action. But we do feel responsible to encourage you to be alert and to be aware of things you can do to protect your finances.

The best way to protect yourself from identity theft is by arming yourself with knowledge. The more you know, the better prepared you can be. Knowing what methods identity thieves use is a good start. That way you can be watchful and avoid putting yourself in a dangerous situation.

How identity is stolen and ways to protect yourself:

* Skimming – You are probably aware that thieves occasionally manage to put card readers on ATMs and gas station pumps to electronically grab your credit card information when you swipe your card there. But there is also technology out there that allows thieves to steal the information while your card is still in your wallet if it is the type of card you can use for “express pay” or holding near a reader to pay without actually swiping it. This video explores the danger of this type of skimming and shares how you can protect yourself.

* Phishing – This type of identity theft can occur via the computer or phone. Phishing scams are those where thieves pretend to be a reputable company asking for your personal information or trying to get you to click links that will give them access to personal information on your computer. Here is a more in-depth look at phishing from Google.

How to find out if your identity has been compromised:

* Credit report – You are eligible for one free credit report with information from all 3 credit bureaus each year. On your credit report you should look for any suspicious activity or accounts that may be listed that you did not open. Should you see anything out of the ordinary, be sure to call the credit reporting company to talk about the activity and find out what to do next. You can get your free credit report at annualcreditreport.com (*please not that this is the only government-authorized site that the three credit bureaus are using, and there are imposter sites out there to avoid – more info here)

The underlying theme in identity theft and protection is to be aware. Know what the risks are and keep yourself informed.

Here are some more ideas on ways you can avoid identity theft:

  • Do not freely give out your personal information.  Know to whom you are giving out information and why. If there is a vendor at a booth asking for your SSN, it might be better to walk away or contact the company directly at their office. Do not give out passwords or other personal information over the phone unless you have specifically called a company via their actual phone number (not one you got from an email that might be spam!).
  • Keep an eye out for suspicious activity. Don’t be afraid to speak up. If you feel that you are in danger or that someone is trying to get your information, you can call the police or contact the company that this individual or email is representing. Many companies say they will never ask for your personal information or password via email, so if you get something of that nature you can get in touch with that company and forward the email so you can be sure it is junk and whether or not you need to take action to protect your account.

The Federal Trade Commission has a site dedicated to sharing information about what identity theft is and what to do if your personal information has been stolen. You can read more on their site about identity theft: http://www.ftc.gov/bcp/edu/microsites/idtheft/

Remember, we don’t want to scare you into action or make you think the sky is falling. We are about being alert and being proactive in your life and finances. If you have any questions about identity theft or want to share any other tips and ideas you may have experience with, please leave a comment below.