The Only Way to Protect Your Credit

With so many data breaches occurring each year, everyone is concerned about protecting their identity.  There are a lot of services that offer credit monitoring for a monthly fee.  But these companies only catch problems after the fact and you still need to spend time cleaning up any errors.

The best way to protect your credit? Freeze it.  A simple credit freeze at each of the three credit bureaus will prevent anyone from opening new credit using your social security number. This also protects your credit score.  The cost for this varies by state and will run between $0-$10 per bureau. In Minnesota, the cost is $5 for each.  $15 is a small price to pay for peace of mind.

This should only be done if you don’t expect to open any new lines of credit in the near future, since the cost is the same to unfreeze your credit. The best time to freeze your credit is after reviewing your free annual credit reports and correcting any errors, if needed.

To freeze your credit, go to each bureau’s website (Experian, TransUnion, and Equifax).  You’ll need to verify your identity and enter a credit card for payment. TransUnion had me set up a user name and password, while the other two bureaus provided a personal identification number.  These numbers are required to lift the freeze, so make sure you have them stored somewhere safe.

To lift the freeze, go to each bureau’s website and specify if it is a permanent lift or enter the dates for a temporary lift.  You’ll also need to enter payment information to cover the cost of lifting the freeze.

Of course this won’t prevent someone from making fraudulent charges on your credit cards, so it’s critical that these accounts are monitored on a regular basis.  I use Mint and Personal Capital, since it’s fast and easy to glance through my account balances and activity. A combination of these services is the best solution to protecting your credit.