For years, I would check my credit report every four months. I can peek at them for free once a year from each of the three credit agencies, so staggering this way gives me the maximum amount of free without obsessing and still keeping a close eye. I like this strategy too because, if I do see a credit card I want for some lovely miles, I can easily fill in the information requested and get approved pretty quickly.
But, unfortunately, we can’t have nice things.
Some bad guys hacked one of the credit agencies. Now life is more complicated and expensive for all of us. The credit agencies keep a treasure trove of information on you and help decide what interest rate you are worthy of paying. Remember, even tenths of a percent matter given compound interest and time, so they wield a lot of power.
The breach was wide-spread enough to assume that everything about you is now out there. Social Security Number, Birthday, Old addresses, Driver’s License Number. It is extremely easy for someone to impersonate you and open credit cards in your name with this information.
So everyone’s advice is to call the credit agencies and “freeze” your credit. Block the spigot of easy credit by creating a pin number only you know. One additional layer of security. Whoop. I found this guide to be extremely helpful and recommend you go do that as soon as you possibly can if you haven’t already. My state mandated a charge of $5 or less for a credit freeze, but I think some states allow the credit agencies to charge up to $30.
…
I’ve been trying to minimize my internet time and have been avoiding the news like a champ for almost a year now. The news that does trickle into view makes me angry. Angry, scared and depressed.
I’m not surprised this breach happened. Of course it happened.
What bothers me is that we’re not doing anything to make it better. The government agency that we consumers can turn to and cry foul is the Consumer Financial Protection Bureau. But the people in power only want to weaken it. We’re marching resolutely backwards in history, kicking and screaming and sobbing.
Why don’t we have free access to our credit reports at all time? Why do we have to pay for freezes and unfreezes? The credit agencies are peddling expensive identity theft protection. They screw up and reach into everyone’s pockets for more? Really?
It’s infuriating and terrifying and I only see additional worries on the horizon. Maybe someone will redirect your social security check into their bank account. Or bill your insurance or claim your tax return. Or some other horrible scenario I haven’t read about yet.
At the very least, go freeze your credit. You guys are savvy and have probably already done this. I just needed to rant. We’ll have to figure out new tactics to preserve our identity as problems come up. It’s going to suck for a while. Sorry.
I believe Equifax is offering free identity theft protection, similar to how Anthem handled their breach. They’re not completely terrible 🙂
It’s a rapidly evolving situation, but I thought the protection was only for a year. It should be for a lifetime.
The free protection is only for a year, then you get charged :/ Philip DeFranco did a good job covering the details of the breach. The link below goes to his video and starts when he begins talking about it, 3:00 min in.
I agree they need to do a better job of things, though. Does seem very greedy. I don’t know why they waited 6 weeks to disclose the breach, but I’d like to think they were trying to get it under control before they told everyone…
https://youtu.be/aS6z0bEpVpM?t=180
I like the attempt to see the best in people “trying to get it under control.”
As someone else who checks their credit on a regular schedule, Thank you for the advice, I was not aware of this.
Facebook is where I get my “news” and this reminder came from Gwen who writes Fiery Millenials.
On top of these identity protection companies profiting from the breach, (Lifelock stock has doubled!), we learned yesterday that Equifax executives cashed in as well. Executives sold their stock, to the tune of 1.8 million dollars, in the days after they discovered the breach and BEFORE they notified the public. They knew it was going to be BAD NEWS. Why is this not considered insider trading? Why isn’t this illegal.
That part makes me furious too!
The executives said they knew nothing but I’m pretty sure they are being investigated or will be soon. It looks pretty blatantly illegal from the outside, and hopefully records of their conversations exist somewhere.
If this is true about the Equifax executives, the SEC will be all over them.
Thanks for posting this valuable article. I don’t understand why it is okay for these credit agencies to have so much information about us! It’s terrifying.
Right?!
This article sums it up nicely for me. Use Credit Karma to track any changes in your credit, and use the nuclear option (i.e. ‘freeze’ your credit) only when you detect attempted fraud.
http://www.businessinsider.com/heres-why-you-shouldnt-freak-out-about-the-equifax-breach-ftc-identity-theft-credit-card-report-2017-9
All the best,
MFB
I thought about going that strategy, but I think I would be too anxious. How often would you have to check creditkarma? Also, I’m pretty sure that information in creditkarma is 7 days old.
Most reporters only report data monthly anyway, its not “live up to the minute coverage” like CNN. By the time you see a fraudulent account on your credit, its likely been open awhile.
Yeah, that’s a good point.
You can expect to pay $2 to $12 to initiate or temporarily lift a freeze at each credit bureau. Check out your state’s laws here: http://consumersunion.org/research/consumers-unions-guide-to-security-freeze-protection-2/
Here’s some great info from Consumer Reports:
https://www.consumerreports.org/consumer-protection/security-freeze-vs-fraud-alert-deciding-the-best-option/
https://www.consumerreports.org/consumer-protection/freeze-your-child-s-credit-to-prevent-identity-theft/
Excellent information. Thanks!
I didn’t realize it was that much to temporarily lift a freeze. I didn’t research it because I knew it would make me angry. So angry.
I hear ya, Anita!
Senator Elizabeth Warren is also furious! She’s introducing legislation and seeking an investigation of the security hack. https://www.consumerreports.org/consumer-protection/equifax-data-breach-brings-calls-for-better-consumer-protections/
Sorry in advance for all of the links! 🙂 But the info below is also some hopeful news…
Consumers Union Demands Equifax Make Affected Customers Whole
In the letter, the consumer advocacy organization called Equifax’s response “wholly inadequate” and outlined seven steps it believes Equifax must take to remediate the situation, including
– paying for credit freezes,
– processing disputes promptly, and
– setting aside funds to compensate consumers.
Read all 7 demands at the link below. 🙂
https://www.consumerreports.org/equifax/consumers-union-demands-equifax-make-affected-consumers-whole/
whoops… I forgot the quotes. I copied & pasted the excerpt beginning with, “In the letter…”
To every paragraph: Yes!
I know everyone’s situation is different. My credit has been frozen for about four years now and I only needed it thawed about five times in four years at 3-5 dollars per thawing. For those who need their credit thawed more frequently this cost will clearly add up. But for those who need their credit thawed less frequently, I find this additional security feature worth it. I used this guide when freezing my credit.
http://clark.com/personal-finance-credit/credit-freeze-and-thaw-guide/
I hope all are readers are minimally disrupted by this breach.
Random question: in one of the interviews I read about you you said that while interviewing for jobs during law school you looked at the starting salary and decided that with the high salary you would likely be able to pay off your debt 4 times faster than most people but one of your classmates said it doesn’t work like that. Can you elaborate on that either in a blog post or reply to this comment? Was his reasoning because the post grad school life style inflation (brand new luxury car, downtown apt, etc.) that most Americans jump into would push out your debt payoff date? Thanks!
Yeah, I think he saw lifestyle inflation eating up the increased salary. The conversation was more about being unable to retire early as opposed to specifically paying off debt.
What exactly happens when you choose to freeze your credit? I have a mint account and review my credit yearly.
You get a pin number that you have to give the credit agencies to unfreeze when you apply for new credit. This is a new piece of information that hackers don’t have (yet) and thus makes it slightly harder for thieves to use your credit identity nefariously.
This is coming from a former banker, but I think this breach could be a good thing. For too long SS # and DOB have been used to confirm identities for credit. This information is now , literally, in everyone’s database. It was only a matter of time. With a high profile breach like this (as opposed to all of the normal smaller ones no one hears/cares about) it could force a systemic change in how we apply for credit and verify identities… Hopefully making it more secure for the information age.
Regarding personal protection, I check my credit at least one a month (it takes 30 secs). If something shows up I’ll deal with it, otherwise I have bigger fish to fry.