Finance Blog
6 Ways To Prevent Identity Theft
In recent years, identity theft has exploded as more methods for collecting, storing, sharing—and stealing—your personal information are developed. Your personal information is used to evaluate you for a credit card, auto loan, life insurance, an apartment or mortgage, and even, at times, a job. As personal information has become more important in financial transactions, it now is more readily available to an extended range of people and organizations.
It’s important to understand how personal information is gathered and used, as well as the steps you can take so that it is accurate, reflects your financial situation appropriately, is only used in lawful ways, and you can avoid becoming a victim of identity theft.
How your personal information is collected
You may be amazed to learn how much of your personal information is on file at places like your state’s Department of Motor Vehicles and the Social Security Administration. Additionally, your information can be found on a whole host of marketing lists that catalog your buying habits, income, education, and much more.
Outside parties can often access this personal information easily. Because of the growing concern about and frequency of identity theft, recent legislation has stepped up efforts to protect consumers’ personal information from unauthorized access by outside sources.
By protecting your personal information, you’re preventing identity theft.
Who collects your personal information?
Marketers. Advanced techniques have been developed to compile extremely targeted marketing lists about consumers. A quick search on the Internet for “marketing lists” will show you just how many are available.
Websites. When you visit a website, information can be gathered either through what you yourself provide or through your usage habits.
Store clerks. Have you ever been asked for your zip code or phone number when you made a purchase? The store may not really need that information, but it helped the store compile a profile of your purchasing habits to be used for marketing purposes—and it may have been sold to others. Be careful when giving out your personal information. Only give what is absolutely necessary.
Warranty cards. Information obtained from warranty cards may be used for marketing purposes.
Grocery store loyalty cards. The cards that give you discounts at the grocery store checkout line also provide a detailed picture to store owners and marketers about your shopping habits. However, many claim the personal data and shopping information collected by supermarket companies from loyalty cards violates privacy rights—and doesn’t even save consumers money.
New identification systems. Numerous institutions, including several airlines, have begun working on plans for identification systems that would rely on background checks, fingerprints, iris scans, and high-tech IDs to verify individuals’ identities and speed security screening.
When to not share your personal information
Less is more—in this case, less personal information shared is more protection for you. You will need to share personal information with financial institutions and anyone else with whom you conduct business, but you don’t need to give your information to every store clerk or website that requests it. You may be offered special discounts for giving out your name, phone number, address, or e-mail address, but you need to weigh the benefits of these deals. You may be surprised at how little information an identity thief needs to discover more of your personal information and ruin your financial life with identity theft.
TIP: Set up a separate email account to register with online shopping sites, newsletters, and anything else that requires an email address. You can protect your personal information and limit the spam in your inbox at the same time.
To keep track of how your personal information is being used, consider signing up for a credit monitoring service. With this service, you will be notified if anyone signs up for an account in your name or with your personal information.
READ MORE:
Credit Trends: Mortgages and New Credit Cards
Money Management Tips: Choosing the Right Savings Account
Money Management Tips: Set Your Savings Priorities
Money Management Tips: Pay Yourself First
Identity Theft: What To Do If Your Wallet Is Lost Or Stolen
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These tips are very useful. I always used to wonder why I get so many catalogs though I have never made any purchases at those stores. It makes sense now. These guys (store owners, marketers, affiliates) sell information about their customers in their own private market place – so if you’ve ever made a purchase at one of their stores, others in the network get an inkling and start sending you all sorts of offers.
The same happens via emails too. Getting an id – theft service like the one offered by Equifax is a good way to see what’s happening with your personal info.
Thanks for this post. Cheers, Samantha
http://firefinance.blogspot.com/2010/10/equifax-promotion-code.html
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