05 Nov Do You Need Credit Monitoring?
You see ads for credit monitoring services everywhere–on television, online, in magazines. There’s the one with the commercials featuring the slacker dude who would be so much better off if he’d gone to the “free” website and signed up for the paid service. There’s the one with the overly-emotional woman whose kids were apparently tragically affected by her identity theft. And now there’s the new one with the teenager whose identity was stolen when he was eight years old. (Since that sort of identity theft is usually perpetrated by a parent, I keep looking for Dad to ‘fess up.) But do you really need to sign up for a monthly credit monitoring service?
If you know that your identity has been stolen, or that someone who has your personal information has been hacked, and you need to monitor for new activity, maybe so. If you know that personal items have been stolen–for example, your purse was snatched–you may want to monitor for a short time, just to be sure. If you are going through the process of applying for a mortgage, it might be a good idea to briefly track all activity. But for most of us, it’s just not necessary to pay for a monthly monitoring service.
Consumers who don’t want to pay for monitoring can get one of their three free annual reports from each credit bureau every four months. New services like Credit.com, … CreditKarma and Quizzle can also provide free credit snapshots, though they generally don’t alert customers to changes in their reports.
By the way, the site to get the credit reports that are actually free is www.annualcreditreport.com. Don’t be misled by cleverly named commercial sites that require you to sign up for a service.
A while back I was offered a year of free credit monitoring, and I tried out the service. My criticism of the service is that it’s information overload. I got e-mails all the time, nearly every day. At first I would diligently check, only to find out that the “alert” was because of normal activity–I’d made a payment that was more than 10% of the balance, for example, which you’ll do every month if you pay off your balance. Long before my year was out I was just deleting the e-mails without reading them.
If you’re interested in learning more about protecting your identity, the Better Business Bureau has set up a site where you can take a test and learn how to protect yourself at www.protectyourid.org. And one of the cheapest forms of insurance against identity theft is, well, insurance. You can add identity theft insurance to your homeowner’s or renter’s policy with virtually every insurer, usually for less than $20 a year–that’s a year, not a month. That’s a whole lot cheaper than credit monitoring, which might cost ten times that amount.
Written by South Carolina bankruptcy attorney Dana Wilkinson
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