How To Protect Yourself From Identity Theft Online

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Identity Theft Protection SmallHey everyone, thanks for joining me for today’s post. So, into the back-story. I was talking to a friend over the weekend about what I do online. One of his questions was, “Don’t you need to use your credit card online keep your website up?”. My answer to that was, “Well of course, every business has it’s expenses and when you work online, you’re probably going to have some virtual expenses?.”. His next question was, “Aren’t you afraid of identity theft?”. He went into detail saying that the best place to get your identity stolen is online.

This is a perfect example of what several consumers believe. They know they can save money by shopping online, paying bills online, or even make money online, but many people are scared to do these things because of identity theft. Personally, I think there are a few reasons for this…

  • Our Schools Under-Educate – School was one of the best times of my life, I really enjoyed it. I can also honestly say that I learned quite a bit there. One thing I can’t say I learned much about in grade school however is…finance. I can remember a math teacher teaching us about the math of compound interest rates with regard to investments and loans, but nothing else. When we graduate, many of us have no idea what a credit score is, what a credit report is, how to access them, that identity theft exists, and how to protect yourself from it.
  • Finance Is A Tabu Conversation Topic – When was the last time you talked to a friend about how much money you have in savings, how much money you plan to save, what you spent money on last month, ect…? The list can go on and on. There are so many aspects of finance that many of us don’t like to discuss with anyone, even friends and family. That being said, people who would’ve helped consumers to catch things early by sharing experience, simply don’t! Most people just don’t discuss these things with friends.
  • Trying To Teach Yourself Can Be Frustrating – I just opened an investment account with Betterment.com. For the first time in my life, at 25 years old, I started to invest. My gosh did it take a lot of effort to really get a feel for what I was doing. Even though, I earned my first dollar today, I can’t say that I am completely, 100% sure I know exactly what lead to that dollar. I’ve got a good idea, but no fine details. That after a week of reading, changing allocations, and more reading! That being said, learning to understand your finances can be pretty intimidating. You’re not intimidated though, you’re here to learn!

Facts About Identity Theft

In the conversation above, my buddy explained to me that using your credit card online is the best way to become the victim of identity theft. Is that true? 

The Reality – In the instance that my buddy was talking about, the crime wouldn’t even be called identity theft, it would be called credit card fraud. The reality is, there is no identity theft protection service that will protect you from credit card fraud. That task is one that is up to your lender. However, the internet is a common market for identity thieves. These thieves want nothing more than to steal your social security number and use it to access loans in your name. They know that the average consumer doesn’t know to check the security features of a website before applying for a loan, or how to research the legitimacy of the company they’re applying for the loan from. Once you have this knowledge, the internet is a pretty safe place.

Another thing my buddy was informing me of is that if you don’t ever put your personally identifiable information online, it will never make it to the world wide web? But, that’s not necessarily true either.

The Reality – Even if you never type your information online, it can still make it there. Most companies use online CRMs or Customer Relationship Managers. They are simple platforms that allow the company to track their clients and the data associated with those clients. While most of these CRMs are pretty secure, there are some out there that are less secure than a wet paper bag. In reality, these CRMs are common targets for identity thieves to shop around in. So, you don’t necessarily have to personally type your data in a website for it to end up online somewhere.

Finally, my buddy hit the nail on the head when he said, “So, if I’m careful when using the internet, I can buy things with no extra risk of identity theft?”

The Reality – Absolutely! You just have to know how to protect yourself from the thieves!

Protecting Yourself Online From Identity Theft

It’s actually pretty simple to protect yourself from identity theft online, but, the process does include a bit of offline work too. There are four things that I generally advise people to do to protect themselves. Here they are…

#1: Understand Web Browser Security Features – I’ve used several different browsers ranging from Firefox to Google Chrome, I even used IE in the dark ages! Anyway, I’ve never come across a web browser that didn’t automatically read security features in websites, and let it’s user know if the website was secure or not. When you are on a secure credit card application for instance, Google Chrome will display a green padlock to the left of the URL in your address bar. Internet Explorer displays a padlock to the right of the URL in the address bar. Finally, Firefox displays a padlock to the left of the URL just like Google Chrome. So, how do they know that a website is secure?

When you buy hosting for a website, you have the option to purchase an SSL security certificate. This is a certificate from your host saying that your website meets some pretty strict security guidelines and is deemed safe to collect fragile data. Data like credit card numbers, birth days, and social security numbers. These secured servers used to host these sites relay security information to your browser which then displays that information to you in a simple icon!

#2: Trust The Site Before Applying Or Purchasing – Working with companies that you would generally work with online is usually a surefire way to insure that you will have a good, secure online experience. If you don’t know who the company is that you’d like to make a purchase with, or apply for a loan through, that doesn’t mean that you shouldn’t work with those companies; it means that you should do a bit of research before making your purchase or applying for that loan or service.

Research is pretty simple. Just type the name of the company into Google with the word “reviews” behind it. For instance, if I wanted to learn more about First Progress credit cards, I’d type something like “First Progress credit card reviews” into Google and click search. When doing this, keep in mind that most websites have affiliate relationships with advertisers, as do I. The only problem with this is that some websites will lie about a product to make the $10 – $300 commission they may make if you sign up. That, I don’t do, and I’m not alone. There are tons of bloggers that are incredibly honest, even if they will lose sales over it. To find them, all you have to do is read several reviews. If the review only talks about good and doesn’t delve too deeply into the bad, chances are, you want to move to the next review. Before working with a company you’ve just heard of, read 5 to 10 reviews and make an educated decision.

#3: Keep Track Of Your Credit Report And Financial Accounts – This is one of those tips that will protect you online and off. Although, you won’t prevent identity theft this way, by stopping the process early, you can save your self tons of money and hassle. Take a look at your credit report at least once a month and see if there are any new loans that you didn’t know about that pop up. Also keep tabs on your checking, savings, investment and credit card accounts regularly. If you see any changes that you didn’t personally make, you just noticed an early sign of identity theft!

#4: Sign Up For An Identity Theft Protection Service – Because there is a real need for credit monitoring and identity theft, there have been several companies that have popped up to do just that. Some companies only provide credit scores while others provide complete monitoring and protection of your identity. Most of them are relatively inexpensive. The cost generally ranges from $15 to $25 per month for individual protection or $25 to $35 per month for family protection. Now for the shameless plug of an identity theft protection service that I have an affiliate relationship with(Yes, that means I get paid if you sign up, read my affiliate disclosure here).

Not only do I have an affiliate relationship with this company, I trust them with my identity. Go check ’em out….Click here to visit TrustedID!

Posts About Protecting Yourself From Identity Theft Around The Web

Gary Dek discusses ways to protect your money while traveling in a guest post on FrugalRules.com.

Here’s a post that I wrote about identity theft on Modest Money!

Even Fox News discusses the risks of identity theft to college students!

Reader Question

Have you ever been the victim of identity theft? Do you do extra things to protect yourself from online identity theft?

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Hey, Im Joshua, the founder of CNA Finance. I enjoy following the trends in the market and finding the catalysts that are making the moves. If you want to get in contact with me, leave a comment below or email me at CNAFinanceHelp@gmail.com Please keep in mind that I am not an investment advisor and nor is CNA Finance. This is a news and information gathering outlet. We may work directly with some of the companies that we write about. If we have a business relationship with an issuer, we will mention that in the articles. We also have various affiliate relationships with advertisers and may be paid if you sign up for a service that you were referred to through our website.

26 COMMENTS

  1. Most of the bank related websites are https secured and it is also important for us to check if we are accessing the trusted websites. With increasing online frauds we need to be very careful before we browse some unsecured sites and leave our important details

  2. Some solid tips for protecting yourself online. Considering that it is not practical for most people not to conduct transactions online – where personal and financial information may be exchanged – it is imperative that it is done smartly. Good article.

  3. My in-laws have a perfect online security strategy.

    They just send us a link to what they want to buy and we buy it for them, just to get reimbursed by them later.

    Flawless.

    • Hey Clarisse, thanks for stopping by and commenting! I’ve gotta disagree with something though. Bank transfers are never safer than credit cards. When fraud happens on a credit card, you can dispute the transaction, start an investigation and get your money back. However, most EFTs cannot be disputed. That means that when you are doing bank transfers, if someone gets hold of your info and steals from you, you may not be able to get that money back!

  4. I agree that one of the biggest problems is education Joshua! People think they can stay away from online activities and they are safe. Wrong not matter what someone can steal it. Heck if the walk by your mail box there is a chance they can get valuable information. Protection is key and great tips. Always need to be sure these days of where you are putting your information and who you are giving it to.

    • Hey Laurie, thanks for swinging by! If you are following those tips, you really don’t need to be concerned about ID theft. It sounds to me like you’ve got everything covered!

  5. Thanks for posting this…protecting yourself from identity theft online is so important. I have online banking and buy stuff online with a credit card. I usually take the steps that you listed, but it can be dangerous out there even when taking precautions.

    • Hey Andrew, thanks for your comment. I’m glad you’re careful and agree, it’s still a dangerous playing field. But, if you take those precautions, you have a better chance of avoiding the problem or catching it early! Thanks again for stopping by!

  6. Hey Joshua. great post 🙂

    Like you, I found that a great many individuals have no clear sense of what it entails to have their identity stolen off the Web. In fact, you are probably more likely to have your credit card number and other identification cards stolen IRL (in real life) than through the Internet.

    I know a woman who has had her identity stolen for the past twenty years and this is before the Web. It doesn’t take much.

    I have been at a bank machine and have been surprised to see credit card statements just thrown in the garbage. These documents have their full CC number as well as address. I have also come across employee pay stubs with a variety of personal information and other info related materials. It would no effort at all if I wanted to steal someone’s identity…which I of course don’t…I have enough trouble with my own 🙂

    I think we all just need to be a tad more vigilant in our getting rid of things.

    Take care and all the best.

    Lyle

    ps: I haven’t forgotten about the budget 🙂

  7. Thanks for these tips Joshua! There are so many situations where your credit card details aren’t safe offline never mind online. I tend to do most of the above but it’s always spending time on these things.

  8. I’ve had my information stolen before and I can tell you it’s not a pleasant experience. But before I admit I was kind of careless with my information. So thanks for sharing this information. You provided some really useful information.

  9. If you use PayPal, does that add an extra level of security? I’ve done this sometimes if I didn’t feel 100% sure, like when buying from a small businesses website. If they have a PayPal option, it makes me feel safer buying from them.

  10. These are some pretty simply and effective tips on keeping yourself protected from ID theft online. Many of us think this sort of fraud isn’t that common and one would be surprised to see official figures related to online scams. The world around us is more transparent and accessible, which makes it harder to protect one’s personal information, so it’s only advisable that extreme is exercised when making online transactions and to only trust big, well-established companies to handle your financial data.

  11. The internet is a reality we cannot run from. We are running increasing parts of our lives on the web from tracking our finances, keeping in touch with friends, shopping etc. The reality is, however careful we are there is no match for a dedicated criminal intent from stealing your identity (from experience in the computer security industry), most criminals though aren’t that dedicated, they go for low hanging fruit and thats where basic internet security for the individual heavily pays in.
    You provide excellent tips to protecting ourselves from identity theft…simple and very effective. At the end of the day, it boils down to basic security awareness on the customers side.

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