The Benefits of Credit Monitoring
Consistent credit monitoring is your best defense against the long-term effects of identity theft and other financial hardships. Even a seemingly insignificant error about your credit activity can seriously hurt your credit score and prevent you from obtaining a loan at a good interest rate. Multiple errors and fraudulent charges made in your name can create a credit nightmare that lasts for years and can cost you hundreds, or even thousands, of dollars to correct.
Efficient credit monitoring can prevent the headaches of identity theft before it's too late. Waiting until after your identity has been stolen to start checking and monitoring your credit is a mistake you'll pay for with your hard-earned dollars. In 2007, 8.1 million Americans became victims of identity theft, resulting in the loss of $45 billion.1
Whether you personally monitor your credit information or sign up for a credit monitoring service, the sooner you know about fraud, the sooner you can address it and start restoring your credit.
Do-it-yourself credit monitoring
Step 1: Check your credit report and score. You're entitled to a free annual credit report from each of the big three bureaus — TransUnion, Experian and Equifax. Review each report carefully, and confirm that all of the information is correct. The bureaus don't talk to each other, so it's crucial you check your credit report from all three bureaus, since the information on each can vary, sometimes significantly.
Step 2: Report any incorrect or outdated information immediately. Not all incorrect information is a sign of fraud — sometimes it's just wrong. But that doesn't make it any less harmful to your credit history and scores. Regular monitoring will prevent false information from adversely affecting your credit scores.
The benefits of monitoring services
Credit monitoring services take the guesswork — and hassle — out of monitoring your credit in between your free annual reports, with alerts that let you know whenever activity occurs in your accounts. A lot can happen in 12 months, and for a small monthly fee, you can avoid unpleasant surprises all year long.
- "BBB Secure Your ID Day — Sept. 20, 2008: Free Shredding & Take Home Advice," Better Business Bureau, Sept. 17, 2008.