Nearly every month there is some sort of data breach of personal information by some company or government agency. The NSA, FBI, and even new Consumer Financial Protection Bureau perform personal data mining without warrants on your transactions or e-mails. The Obamacare website, in development for three years, was released without any security protection for personal information and several breaches were reported within the first month.
To combat companies and government agencies losing your information from theft or accident, some people enroll in a credit-monitoring service to find any suspicious activity from fraud or identity theft. But this is too late! The damage is already done, money may have already been borrowed and spent in your name.
The best way to prevent identity theft is stop it before it occurs by locking or freezing your credit report. When you lock your credit report, no company can access it without your prior approval. So if an identity thief want to open a credit card in your name, he or she will be prevented from doing so because the credit card company will not have access to your credit report.
Locking or freezing a credit report is a flexible feature, you can unlock it for a particular creditor that you want to have access. Or, you can totally unlock it and re-lock it to fit your circumstances.
To lock your credit report, you must contact each of the three credit reporting agencies, TransUnion, Equifax, and Experian. Today, they charge $10 to perform this and two of them allow you to lock your credit report online, Esperian requires a written letter.