Identity theft is the fraudulent use of someone’s personal data, including social security and driver’s license numbers, financial account information, credit card data, ATM passwords, online logins and even children’s personal information. Thieves can use your information to buy goods, empty your bank account or take out loans in your name. And households with higher incomes are more likely to be targeted. How can you defend against identity theft?


Start by securing physical items

  • + Guard your wallet or purse closely in crowded areas. Consider bringing only the card(s) you need on a given trip.
  • + Watch for skimmers at ATMs or on credit card readers. These tiny gadgets can record your account info, which can be used to make a duplicate card. Use an electronic chip reader whenever possible.
  • + Take your receipts when shopping, or safely discard them. Consider using electronic receipts instead.
  • + Keep social security, health and financial documents in a safe or a safety deposit box.
  • + Shred account statements or sensitive documents before recycling them. This includes unsolicited “pre-approved” credit card offers.
  • + Don’t leave mail in unsecure locations. Consider renting a box at the post office or another delivery site.

Online and Digital Security:

Reduce the risk of cybercrime

  • + Don’t use public computers or public Wi-Fi for any financial transactions.
  • + Look for signs of additional security on websites before entering personal data. An address that begins with https:// instead of http:// is one example.
  • + Don’t share personal or account information via email with people you don’t know. Your bank will never ask you to enter your password in mail. And don’t click links on popup ads or emails that you weren’t expecting.
  • + Use different passwords for your online accounts. If one is compromised, your other accounts are protected. Consider changing all your passwords periodically.
  • + Learn to spot scams, like threatening phone calls or emails with offers that seem too good to be true.

How do you know if your identity has been stolen?

Unfortunately, it happens to millions of people each year, no matter how careful they are. Here are some signs to look for.

  • + Unknown charges show up on your credit card. Your provider may even call you about suspicious charges. Be sure your provider has the best phone number to contact you. Check your bills and account statements closely each month.
  • + If a regular bill is late to arrive, contact the merchant or institution.
  • + Creditors or banks contact you about a delinquent loan you don’t recognize.
  • + Money is withdrawn from your brokerage or bank accounts.
  • + You are locked out of your online accounts, including email or social media.
  • + A merchant contacts you about a data breach, for example the Yahoo! breach and the FAFSA data retrieval tool breach.

What should you do if your identity has been stolen?

Begin repairing the damage as soon as possible, to limit your financial risk and reduce any impact on your credit rating.

  • + Cancel any cards that were stolen and request replacements. If you pay bills online, make sure you update your account data to avoid missing a payment.
  • + Change the passwords and PINs on affected accounts. If you re-use passwords across accounts, you’ll need to change them all.
  • + If you see bogus charges on your account, contact the merchants’ fraud department to freeze your account. Ask for a letter confirming that the charges were not yours, that you are not liable for them, and that the false charges were removed.
  • + Contact any one of the three credit reporting bureaus, Experian, Transunion, Equifax. Have them initiate a free 90-day fraud alert. You can also request a credit freeze, stopping all credit queries without your approval. This will prevent thieves from opening new accounts in your name,
  • + Get a free copy of your credit report and review it for any fraudulent accounts or activity.
  • + Contact the FTC at and file an Identity Theft Report. Or call 1-877-438-4338.
  • + File a report with local police. Your credit card provider and financial institutions may require a report number to clear any fraudulent charges.
  • + Consider an identity protection service.

Unfortunately, cases of identity theft and fraud are growing each year. The damage can range from minor inconveniences to legal fees to protect yourself from unauthorized charges and restore your credit health. Practicing safe habits will reduce the risk of identity theft and help protect your financial plan from unexpected attacks. If you have any questions about how you can safeguard your personal information, your Paracle advisor would be happy to talk with you.

Disclaimer: This article has been provided for informational purposes only and should not be considered as investment advice or as a recommendation. This material provides general information only. Paracle Advisors does not offer legal or tax advice. Only private legal counsel may recommend the application of this general information to any particular situation or prepare an instrument chosen to implement the design discussed herein. CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, this notice is to inform you that any tax advice included in this communication, including any attachments, is not intended or written to be used, and cannot be used, for the purpose of avoiding any federal tax penalty or promoting, marketing, or recommending to another party any transaction or matter.

Paracle Advisors is an investment advisor registered with the Securities and Exchange Commission.