TARGETed

Credit: jscreationzs 

Identity theft is a terrible problem that is sadly becoming more and more common. I must confess that I wasn’t that surprised when I first heard about the Target data breach over the holidays, but as the number of potentially affected shoppers has crept up close to 100 million, a lot more of my friends, family members, and clients have been asking me about it. Ask and you shall receive! Here are some suggestions for how you can try to protect yourself from identity theft whether you are a Target shopper or not:

• Check your statements! It is so easy to throw away the statements or auto pay your bills and ignore your transaction history, but I urge you to take a look. Without reviewing my statements I would not have found out about my Michigan “stunt double” who likes really nice women’s boots from Zappos or my Athens, Georgia, “doppelganger” who went to town at the Apple store shortly after waiting on me at a restaurant. Those two fraudulent instances happened to me in the last three years and could have cost me more than one thousand dollars, but they didn’t because I review my statements.
• Minimize (or eliminate) the number of times you use a debit card for purchases. When you use your debit card (or someone successfully claiming to be you uses your debit card), the money immediately leaves your bank account. When debit card fraud occurs, you will have to fight to get your money back, and it will take time. With credit card fraud you will still probably have to fill out some paperwork, but at least the money will never leave your hands (assuming you check your statement before you pay the bill!).
• Destroy the labels on your prescriptions and on packages you receive so that your information is less available to any trash or recyclable “treasure hunters.” Rip up or shred documents containing personal information, and cut up your expired credit cards before you just toss them in the wastebasket.
• Make a copy of your credit cards and important documents like your passport and driver’s license, and put them somewhere really safe. They won’t be of much value should the originals be lost, stolen, or disappear, but at least you will still have access to your information and quickly be able to find the 1-800 numbers you need to call to take action should a situation arise.
• Be careful using public wireless networks. Computers are not my area of expertise, but I know enough to tell you that really smart, bad people can probably gain access to your information if you are not on an encrypted website or using a network that is not properly protected. I’m sorry, but airports, coffee shops, and hotels probably aren’t the best places to check your bank statement, pay your bills, or conduct personal business.
• Take advantage of some of the notification features and fraud alerts that many banks and credit card companies offer. If someone tries to use my card for a significant amount or in a particular city or state I’m not often in, I’ve been able to set it up so that I get notified. It’s quick, it’s easy, and it’s usually free. Besides, if you’re spending a lot of dough in a lot of different cities, it can be a good reminder for you to cool your spending jets!
• Review your credit report every year or two. You’re entitled to a free copy of your credit report every 12 months from Equifax, Experian, and TransUnion, so take advantage of that. Credit reports can help you detect identity theft, and they are good to review to make sure they are correct and up to date as credit reports can affect loan interest rates and even job applications.
• There are tons of other things you can do to protect your identity, like freezing your credit or purchasing more encompassing identity theft protection services. If you are really worried, have been a recent victim of identity theft, or have a reason to think you could be at a high risk of identity theft, you may want to look into some of these additional techniques and services. Either way, I’d advise you to think like a thief when it comes to identity theft prevention - at least make it hard for them!

 

Target probably should have been more careful, more vigilant, and had more safeguards in place to prevent or at least quickly detect identity theft. That being said, all of us probably should.

 

-Tom

Autopilot

Credit: David Castillo Dominici

Do you pay any of your bills electronically? If so, have you set up automatic bill payment, where you give a particular vendor (like your utilities provider) the authority to charge your checking account or credit card whatever amount you owe for a particular month? Perhaps you have set up an automatic distribution from your checking account to pay off your credit card monthly or even automatic distributions from your checking account to make your mortgage payment? Using automatic bill payment has its perks and its drawbacks, but if you are a fan of this common payment feature, you still need to keep an eye on things…

Let’s say there was this guy who had his credit card set up for automatic, end-of-the-month, balance-due payments from his checking account. Let’s say an evil little larcenist from Michigan was somehow able to charge more than $200 for a purchase from Zappos to the guy’s account. How would the guy know about the fraudulent charges if he strictly relied on automatic bill pay and didn’t check his statements closely?

Let’s say there was this guy who had a television provider sign him up for a special, initial monthly price that went away after six months. Rather than the channel selection automatically being reduced to the package the guy originally wanted, the special package was mysteriously automatically retained, and the price promptly soared when the introductory period came to an end. How would the guy know if he strictly relied on automatic bill pay from his credit card to cover his family’s television bills?

Finally, let’s say there was this guy who made a payment online to his water and sewage company, but for whatever reason the payment was not recognized by the company despite their e-mail confirmation. Now in this case, the funds never left the guy’s account, so it wasn’t quite as big of a deal as it could have been, but how would the guy know he had a late fee that he could easily explain away if he strictly relied on automatic bill pay and did not keep an eye on things?

Now I know that automatic bill pay can be great because it is convenient and practically ensures you will pay your bills on time, but you should still be careful. The examples I mentioned above do not happen often, but when they do, you want to catch them. If you don’t believe me, you should, because the examples I used above all happened to “this guy” (yeah, me) in 2012! I caught them and want you to do the same.

Those first bills of 2013 should be about to start trickling in if they haven’t already, and now would be a perfect time for everyone to take a closer look and make sure their “autopilot” bill payments are still working.

• Be vigilant- If you are going to use automatic bill pay, make sure the services are free or charge very minimal fees, make sure your payments are being made on time with no late charges, and make sure you are paying entire balances due, not just minimum payments due (if possible).
• Double-check accuracy- If you are going to use automatic bill pay, make sure the services you are paying for are the ones you wanted, and make sure the expenses you are paying for are truly yours.
• Look for savings- If you are going to use automatic bill pay, make sure you aren’t paying more than you need to. Do you need high definition for all your television boxes? Do you need that 5 GB data plan for your smartphone if you’ve never used more than 2 GB? Do you still need a landline? Do your children realize what taking an hour-long shower means? Take a look and you may surprise yourself. If you find even one way to save more per month, it will be worth your time. Even if you don’t find any new ways to save per month, it will be worth your peace of mind.

Now this post may sound like I’m being a little harsh on automatic bill pay, but keep in mind I sometimes use this payment feature myself. If you have sufficient funds and spending self-control, but just have trouble getting your bills in on time, I might even recommend automatic bill pay to you! I’m not trying to scare you away from using automatic bill payments (and certainly not from the convenience of electronic bill payments), I’m just trying to help you find some monthly savings and protect yourself.

Autopilot can be great, but don’t fall asleep in the cockpit.

-Tom