Locking down your credit…

This e-zine was originally sent on August 28, 2009.

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You are receiving this note because you are a client or friend of Aaron Miller.
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You’ve got to say, I think that if I keep working at this and want it badly enough I can have it. It’s called perseverance.
– Lee Iacocca

Hello, Collin County Parents!

Well, I’m sure you’ve noticed the traffic on the roads increased this week.  I know I sure did.  It seems that every year about this time, the traffic suddenly triples, and that means one thing – school is back in session!  If you’ve seen my drive around like a maniac this week, it is because I’m wearing one of my many hats, that of morning taxi cab driver.  I’ve been taking the two youngest girls to elementary and then thirty minutes later dropping number 1 daughter off at middle school.  Sadly last year was the only year for all three girls to be at the same school.  So I get to do the split drop off for several more years!  Ah well.  Anyway, after the first-day-of-school chaos on Monday, I’m really looking forward to things calming down a little bit.  I’m sure you are too (even if you aren’t running kids to school)!

This week, I’d like to talk about how you can protect your family *different* way–with your credit. These days, it seems like that the possibilities for identity theft are endless…but the fix is quite simple–and you DON’T have to pay for a special service…

Read on, and send me your feedback.

Aaron Miller’s
“Straight Talk” Personal Strategy
Locking Down Your Credit

Identity theft is becoming all too common as personal information becomes easier to swipe. Internet sites all ask the same security verification questions. One site could easily collect your information and then try using it on others.

For example, a student filled out a credit card application outside a university football game with the promised bonus of a free T-shirt. (Incidentally, that’s exactly how I got my first credit card.  Go Longhorns!)  The scammers used all his information on a real credit card application but changed the mailing address. (Thankfully, the card I signed up with was legit.)  By the time the student realized his identity had been stolen, creditors were hounding him for hundreds of dollars of charges.

Having your identity stolen costs an average of $40 and 10 hours defending your name and cleaning up the mess. It happens to about 0.8% of the U.S. population each year. Even if your time is worth $100 an hour, the average loss to you is only about $8 annually. So clearly it’s not the actual monetary cost that bothers people. What’s really worrisome is the uncertain cost to clear it up, the vulnerability, and personal violation they feel.

Fortunately, there is a simple and easy way to acquire a full credit lockdown so no one can initiate changes to your credit without your permission. Your credit information is stored at three main credit bureaus: Experian, Trans Union and Equifax. At the end of 2003, Congress passed legislation that requires these bureaus to allow you to put a fraud alert on their credit reports. The alert only lasts 90 days, but during that time lenders have to verify your identity before they can issue a credit card in your name.

Since then, several companies have used this law to offer a renewal of the fraud alert every 90 days on your behalf. LifeLock is the best known among these services. The company went so far as publishing its CEO’s Social Security number and daring people to try and steal his identity.

Although LifeLock’s service is convenient, you can still duplicate their services by placing a credit security freeze on your own credit record. A credit freeze does everything a fraud alert does and more. First, it is permanent, not just for 90 days. Second, it prevents lenders from seeing your credit report unless you specifically grant them access. This strategy prevents identity thieves from getting new credit in your name even if they have every bit of your personal information.

If you do apply for additional credit, you will have to remove the freeze temporarily or give the specific party who wants to access your information your personal identification number (PIN).

If you plan on applying for additional credit cards or getting a new cell phone provider or cable package, a credit freeze may not be advisable. And those promotions linked to new credit card applications will no longer flood your mailbox. But these deals are never a way to build real wealth. Get the few credit cards you need, and don’t let any promotional offers suck you in.

Each credit bureau charges a onetime fee of about $10. If you have already been the victim of identity theft, the charge is waived. If you have relatives in other states, they may not be charged the fee regardless, because some states do not permit credit agencies to charge its customers for placing a security freeze. Unfortunately, Texas is not one of them.  If you’ve already established the credit you need a credit freeze is a good idea.. A freeze both reduces the frenzied marketing of additional credit opportunities and the potential harm of compromised personal information.

After a few minutes of effort and about $30 in payments, your credit should be locked for life. Here is how to accomplish securing your credit at each bureau:

* At Experian (888-397-3742), go to http://www.experian.com/consumer/security_freeze.html .
* At Trans Union (888-909-8872), go to https://annualcreditreport.transunion.com/fa/securityFreeze/landing to start the process.
* At Equifax (1-888-766-0008), you can put a lock on your credit by visiting https://www.freeze.equifax.com .

The process is not standardized across the three credit bureaus. Each uses a different methodology. But with a little effort, your credit will be safe and secure.

Each bureau will give you a PIN. They are likely to be all different. Don’t lose these! Trying to get a security freeze lifted when you have forgotten the PIN necessary to change your credit security is a catch-22 you don’t want to experience.

To your family’s wealth, health, and happiness!

Aaron Miller

Miller Law Firm, PLLC
101 E. Park Blvd., Suite 600
Plano, Texas 75074
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Written by Miller Law Office

Miller Law Office

The Miller Law Office is here to help you build and protect your legacy. Rather than having a traditional estate planning practice, which is focused on transactions (such as the drawing up of wills and other documents), we have a more relational focus – having on-going contact with clients over the long-term, helping clients to protect themselves and their families.