Personal Information Security

Start Article When we talk about "successful personal finance," we are not simply talking about "amassing a truckload of money." In reality, successful personal finance — referred to hereafter as "SPF" — encompasses a mighty wide swath of things. Of course we wish to minimize and eliminate debt. Of course we wish to accumulate money. But we also wish (or should!) to reduce stress, to make things as easy for ourselves as possible. If there are some facets of life which we can put on autopilot, we might want to think about doing that. If there are means by which we can reduce potential worry and frustration in the future, we definitely want to consider them.

I believe SPF is, in no small part, also about protecting oneself and one's family. In this arena, we should aim to eliminate as much risk as possible. That includes the risk of someone acquiring our sensitive personal information and using it in a destructive manner.

Reducing such risk equates to reducing potential stress, too. If you want to see bigtime stress in action, read stories of people who have had their personal information stolen and their bank and credit accounts compromised. (Like this one [PDF, 111kb] from Money magazine in November 2004.)

So, with that in mind, here is a checklist of actions you can take to help protect your family from identity theft and account misuse. The way I see it, the less time you spend worrying about (or dealing with) the theft of your personal information, the more time and energy you can devote to attaining financial freedom.

NOTE: A printable version [PDF, 50kb] of these steps is also available.

1. Put the SECURITY in Social Security. Do not give out your Social Security number to people or companies that you do not know. Under no circumstances should you give out personal information on the phone to someone you do not know, or if you did not initiate the call. If someone calls looking for personal information to ?update records,? get their name, phone number, and address. Call them back at the number you have on file, or use one that is printed on your billing statements. Do not disclose personal information until you know why it is required and how it will be used.

2. Watch your credit reports. Review your credit report from each of the three major credit reporting agencies (TransUnion, Equifax, and Experian) at least once per year. Check the information and dispute any inaccuracies. Ascertain that there have been no inquiries by people with whom you have not initiated business. Keep in mind that American consumers are entitled to one free credit report (www.annualcreditreport.com) from each agency once per year.

3. Pay attention to your statements. Regularly monitor your accounts via the internet, if possible. Review all monthly credit card statements and bank statements as soon as they arrive each month. Be sure there are no charges you did not make. Also make sure you actually receive the statement each month. If it is late, contact the card issuer and make sure no one has changed the address on the card.

4. The joy of shredding. Shred all paperwork which contains your personal information. When shredding, cross-cut so that no numbers remain in readable rows. Destroy any and all unwanted credit card and refinancing offers. Shred any documents you no longer need which contain personally identifiable information and account numbers.

5. Guard your mail. Fight mail theft by collecting yours regularly. Forward it to a post office box if you will be out of town. Always take bills or documents with personal data to the post office or an official postal service mailbox; never leave them for pickup in your personal mailbox.

6. Secure your stored personal info. Store any personal information you keep at home and at work in a safe place. Do not put any information other than your name or address on your checks.

7. Guard your checks AND deposit slips. Guard deposit slips as closely as checks. Not only do they have your name, address, and account number, but they can also be used to withdraw money from your account. (Mr. Thief can simply deposit a bad check and use the ?less cash received? line to get money out of the account.)

8. Denied credit can be a sign. If you are ever denied credit, find out why immediately. This is particularly important if you have not reviewed your credit reports lately. If you get a call from a merchant or card issuer about charges you did not make, react quickly. This may be the first warning that your identity has been stolen or compromised.

9. What's in your wallet? Do not carry your birth certificate, passport, or any other cards which display your Social Security number in your wallet. Only carry as many credit cards as necessary. Photocopy everything that you carry in your wallet — both sides of all cards — as this will make canceling and replacing items dramatically easier if your wallet or purse is stolen.

10. Use strong passwords. Create unique passwords and personal identification numbers (PINs). Avoid using easily available information, such as mother?s maiden name, date of birth, or the last four digits of your Social Security number.

11. Do not trust email. Do not answer email requests for personal or account information unless you are certain of their legitimacy. "Professional appearance" and company logos mean nothing. Initiate the visit to the requestor?s website yourself through a known valid link, or make a phone call to the business regarding the inquiry.

12. Protect your name. Get an unlisted phone number, or drop your address from the listing. Do not use titles such as "Dr." or "Atty" in your listing.

13. Put your computer on lockdown. If you have a fulltime internet connection (such as DSL or cable) and aren't using a firewall (ZoneAlarm has a free version) and virus protection, you're taking chances — big chances. Your choice of browser can be significant, also. Microsoft's Internet Explorer is the standard, but free, open-source browsers such as Mozilla's Firefox tend to be much more secure when it comes to inadvertently opening "back doors" to your computer. Spyware is a problem, too, so don't forget to use a spyware eliminator of some sort.

Additionally, if you keep passwords and such on your computer, programs like Password Safe can help you store them, as well as keep them away from unintended eyes.

Obviously, this list is not exhaustive. If you know of other helpful tips for preventing identity theft, I'd love to hear about them. Send me an email!