Is your idea of a “bad guy” stuck in the script of a horror movie? 

Scary masks, dark corners, and thunderstorms make for a great spooky story, but what happens when the “bad guys” hide in plain sight? 

The growth of the internet, online shopping, social media, etc., has made it easier for scammers, hackers, and identity thieves to wreak havoc. 

Just think about how many sites you put your credit card into daily! Suppose that information falls into the wrong hands. In that case, you could easily see fraudulent charges of someone buying hundreds of dollars worth of Costco goods in California when you’re sitting at home in Kansas minding your own business. 

There are numerous types of fraud to be aware of: credit card scams, identity theft, etc. 

So far, in 2022, the Federal Trade Commission (FTC) has had 361,735 fraud reports. Fraud cases also skyrocketed in 2021, making it clear there’s a serious problem at hand. 

But don’t panic! There are things you can do to prevent this type of theft from happening to you.

We’ve compiled a list of ways to prevent identity theft and what you should do if you find yourself a victim. 

#1 Create Different, Strong Passwords For Your Accounts

Let’s be honest; most of us are guilty of having one password for various websites. How are you supposed to remember all of them otherwise? But, while repeatedly typing in the name of your favorite pet followed by “1!” might be easy to remember, the habit can be dangerous. 

In addition to choosing different passwords for different sites, it’s critical to make an effort to create strong passwords. 

Why are strong passwords important? Mainly because they resist access by trial and error. By making your answer complex, you’re less likely to be hacked. 

What’s the recipe for a strong password? They should include:

  • At least 8 characters
  • A mix of numbers and letters
  • Use of both upper and lower case letters
  • Use of special characters ($, ! *, etc.)

Here’s a list of what you should avoid when creating a password:

  • Anything someone can easily guess (password, 1234, etc.)
  • Words that contain your name, birthdate, children’s names, house number, pet, etc.

While it’s easier to remember a password with your child’s name or birthdate, unfortunately, that also means it could be easy to hack. Taking steps to create unique and strong passwords can help protect your personal information.

#2 Check Your Credit and Bank Statements Regularly

There’s no feeling like logging into your credit card statement and seeing an unfamiliar charge. Your stomach drops, and you re-think your recent purchases, all to find out your partner purchased something you were unaware of. Whoops!

According to the FTC, credit card fraud is the most common form of identity theft. That means it’s essential to stay on top of your credit card and bank statements to keep an eye out for anything suspicious. 

Some financial institutions may already have security measures, like declining a purchase if it’s over a certain amount or requiring additional authorization for a purchase from another country or state. While these things can be a nuisance if you’re traveling, purchasing a gift, etc., they’re there to keep you safe. 

If you notice any suspicious activity, inform your financial institution immediately. Most companies won’t hold you liable for suspicious charges, but make sure you read their policies just in case.

Reporting it right away will make it easier for your financial institution to resolve. If you wait until your following statement, the process may be more challenging to rectify. 

#3 Properly Dispose of and Store Documents 

Check your mail regularly if you receive paper statements from your bank, credit card company, IRS, etc. You don’t want someone taking a letter directly from your mailbox because you have been on vacation or haven’t checked it in a few days. 

Before heading out on vacation, ask a trusted neighbor or friend to collect your mail while you’re gone. Or, you can go to the US Postal Service website and request to put your mail on hold for the dates you’ll be away. While this might not be necessary for a weekend away, it may help you relax on your cruise, knowing your mail isn’t getting into the wrong hands.

Do you like to save paper statements for your personal records for tax purposes? If so, dispose of them properly when the time comes, like shredding. 

Also, be mindful of where you keep these documents in your home. Having a designated location or safe is helpful for organization and keeping your documents out of the wrong hands.

#4 Check for Data Leaks

It’s frustrating, but sometimes you can do everything right on your end and still be a victim of a data breach or leak. We see them on the news all the time: somehow, a hacker gains access to a user list of a website, and they now potentially have access to your information. 

If your information has been leaked, the company should promptly let you know. Then, you can do the following things right away:

  • Change your passwords
  • Let your financial institution know of potential fraud alert
  • Closely monitor your financial accounts and credit report
  • And, if you feel it’s best, freeze or lock your credit and bank accounts

Unfortunately, the benefits of online shopping also bring with it the potential for a data breach. If you find yourself in that situation, stay calm, and follow the steps above to secure your financial accounts. 

The Bottom Line: Be Cautious and Observant

Identity theft happens often, but there are things you can do to protect yourself. All of the tips we’ve given you have a common thread, being cautious and observant. 

Just like the saying “better safe than sorry,” it’s better to add an extra number to your password or shred the document before throwing it in the trash than have your credit card number or personal information stolen.

If you want help keeping your finances safe, please reach out to us. We’re here to help!

Disclaimer:

The contents of this article are for general information and educational purposes and should not be construed as specific investment, financial planning, tax, accounting, or legal advice. Please consult with a professional advisor before taking any action based on the contents of this article. 

All investment and financial planning strategies involve risk of loss that you should be prepared to bear. We cannot guarantee any investment performance whatsoever, and past performance is not indicative of potential future returns.