How to Protect Your Finances and Yourself from Identity Theft

This Credit Education Month, it’s important to know what identity theft is, how to best reduce the risk, and ways to protect your finances. According to the Federal Trade commission, theft of benefits in 2020 were up 2,920% over 2019 in the United States. While theft of pandemic relief and unemployment benefits contributed to a portion of this percentage, thieves and scammers are also developing more intelligent ways to gather information. Below, we’ll look at what exactly is identity theft and ways to protect your information.

What is Identity Theft?

Identity theft occurs when a person uses your unique data to steal from you or pose as you. Identity thieves may drain your bank and investment accounts, open new credit lines, or even use your insurance information to get medical treatment. A thief can get your information in person or online by stealing your mail or garbage to get account numbers or your Social Security number, trick you into sending personal information in an e-mail, steal your account numbers from a business or medical office, or steal your wallet.

Ways to Reduce Your Risk of Identity Theft

While there is no definite way to fully prevent identity theft, there are actions you can take to reduce your risk.

Safeguard Your Social Security Number

Your Social Security number is the master key to your personal data, so it’s best to guard it as best you can. When asked for your Social Security number, ask why it’s needed and how it’s protected. Don’t carry your card with you and securely store or shred any paperwork that contains your number or information.

Use Strong Passwords and Additional Authentication

Use passwords that aren’t easy to guess and frequently use numbers and symbols when possible. An online password manager can create and store complex, unique passwords for your accounts. For added security, you can also keep a physical notebook with a list of your accounts and passwords. This way, even if your PC is stolen, your passwords will remain safe with you.

Additional authentication can also keep you safe. Websites, such as Google, will send you a text or e-mail when there’s new log ins to your accounts. Many financial institutions will also text or e-mail when transactions are made.

Watch Your Mailbox

Stolen mail is one of the easiest ways a person can steal your identity. If you’re out of town, contact your Post Office and ask to have your mail held until you return. Alternatively, you can also sign up for Informed Delivery through the USPS, which is a service that provides you with a preview of your mail so you can tell if anything is missing upon delivery.

Dispose of Documents Properly

When you no longer need paper documents or records containing your sensitive personal information, be sure to shred or dispose of them properly. Experts recommend shredding junk mail as well, especially credit card promotions. If you have a large amount of paper to shred, consider taking it to a facility or use a service that certifies your documents are fully destroyed, such as a credit union an office supply store.

Be sure you’re careful with digital documents, too. Before recycling or selling your computer, be sure you’ve cleared your hard drive. You can use a similar method with phones and tablets. This ensures that any residual files won’t contain sensitive data or information.

Consider Your Cards Carefully

When going out in public, limiting the number of cards you carry reduces your risk of identity theft if your wallet is stolen or lost. Thieves may also use small devices to tamper with card or chip readers, known as skimming or shimming. You can further reduce your risk by monitoring your accounts closely for unauthorized charges and checking for signs of tampering on card readers.

Use a Lender Who Cares

At Homestead Funding, your privacy is important to us. Whether you’re using our Homestead Moves app or our website, your data is fully encrypted and protected. If you’re looking to purchase or refinance your home, contact us today. You’ll be paired with a Loan Originator who will address your unique financial needs.