Five Ways To Get Through Identity Theft

A few days ago my debit card to our joint checking account was hacked. A purchase was made from somewhere overseas for $77.88. There was also an international transaction fee for $0.62.

I wanted to walk you through the process to help you when it happens to you.

According to an article in USA Today, I was one of about 15.4 million Americans who was a victim of identity theft in the last year. And guess what? It was not the first time my debit card was hacked. At some point in time, you (or someone you know) will be affected. It is a certainty.

So what are we supposed to do? Keep reading. Below are 5 ways to get through identity theft.

Get Protection

Do not fool yourself. You need identity theft protection. It will surely cost you more if you don't have it than it will to pay the premiums. The Federal Trade Commission (FTC) estimates that it can take the average person up to 6 months and 200 working hours to recover their identity.

Do you have that much time and energy and lost wages to spend trying to get your life back? I know I don't.

Not having identity theft protection is equivalent to choosing to drive without car insurance. You won’t miss it at all...until you need it.
Tweet: @lisayjoneslyj Not having identity theft protection is like choosing to drive without car insurance. You won't miss it til you need it.

Not having identity theft protection is equivalent to choosing to drive without car insurance. You won't miss it at all...until you need it.

Protect. Don't Monitor.

But do your research to determine which company to use. You don't need a company that just monitors your credit. Every financial institution in the world has an entire department monitoring your accounts in order to protect themselves against you being attacked.

So don't pay someone else to do what your banking institution is already doing for free.

Instead, put your money on the recovery side. While there are a lot of companies out there who advertise how well they monitor your accounts, there are not very many who actually do the legwork after the hack. This is what you really need to purchase.

We have a policy with Zander Insurance. For a very small monthly premium, they will step in AFTER the identity theft has happened and do all of the legwork to recover your identity. ALL OF IT. Check out their site and review it for yourself. If you choose not to use Zander, pick another company that will work after the theft to restore your identity.

The premium is well worth it to know there is a team ready to step in and get your identity back! Especially when you consider how difficult it has been to keep identity theft from actually happening in the first place.

Reconcile Bank Accounts Regularly

We did not need to use the Zander policy for this case of identity theft. The reason is not because the amount was small. The reason is because we reconcile our checking account several times a week and caught it ourselves before it became a bigger issue.

We use an online budgeting tool and each transaction is assigned to an online envelope. By using electronic envelopes (or categories), it is easier to reconcile a few times a week instead of waiting until the end of the month.

There are typically only a handful of transactions to reconcile every few days. So the details of the identity theft (charge amount, company name and the separate international transaction fee) stood out to me. I immediately contacted our bank's fraud department. They worked with me quickly to shut down the card, get a new one issued and refunded the transaction amount the next business day.

If I only reconciled the account monthly (or heaven forbid less often), it is likely I would have missed the theft. And since the transaction was only a few hours old, the thief had little opportunity to use the card again. The more time passes, the more opportunity thieves have to use the card again and inflict more costly financial damage.

Don't Fall For The Debt Myth

Society tells us that credit cards keep your identity safer. Not so. According to the Bureau of Justice Statistics, over 8.6 million people had their credit card information hacked in 2014. Not debit cards.

So don't believe the hype. Credit cards are just as susceptible to identity theft as debit cards and the recovery process is not that different. There's absolutely no reason to keep credit cards. They don't protect your purchases any better.

I know what you're thinking. "But Lisa, a credit card theft won't take money out of my checking account."

You're right. It won't.

But the interest and fees you pay WILL take your money.

Credit card use is debt...even when you pay the balance off every month. Stay away from all forms of debt and your financial wellness journey will be safer and more rewarding.

Change Passwords Often

This one is tough even for me. We get comfortable. We get complacent. We don't want to have to come up with yet another string of characters for EVERY account.

We still need to do it, however. Your identity is much safer when you do.

There are lots of tools out there to assist. We just use a password protected spreadsheet, but you can go as high tech as you'd like. The key is just to make the change...often.

Check Your Credit Report Annually

The FTC mandates that every person be allowed to pull a credit report from all three reporting agencies each year. This is a free REPORT, not a free SCORE.

You can only get a free report from the Annual Credit Report website. Note the name. It must be this site only. All other websites are knock-off sites.

Review all open and closed accounts to make sure no one has opened accounts in your name.

Some people space the reports out and pull from one agency every 4 months. I don't care how you do it. Just do it! You have no idea what open accounts are lurking in your name if you don't check.

Proverbs 10:4 tells us "poor is he who works with a negligent hand, but the hand of the diligent makes rich." Take the time to protect your finances and your identity. It will pay off greatly in the end.

Have you experienced identity theft? Regardless of whether your answer is yes or no, I'd love to hear your thoughts on this one.

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Until next encouraged.