The Credit Freeze

Last summer we shared with you the extent of the Equifax data breach and the impact it had on 143 million American consumers whose personally identifiable information was stolen.

The trend continues and in 2018 alone, several retailers from K-Mart to Sax Fifth Avenue have reported compromised customer data. Even social media giant Facebook was breached, affecting an estimated 87 million records. Sharing data and conducting business online is certainly convenient and has become a fact of life, and it is now up to you to protect your own data.

Our advice continues to be very direct and clear: Freeze Your Credit.

Updated To The Credit Freeze Process

We were pleased to see developments this past year that have made the process of freezing and unfreezing your credit a more manageable process.

First, the major credit bureaus have made significant improvements to their web platforms that allow you to freeze/unfreeze your credit by accessing a portal and requesting a credit lock online. If you took the steps to freeze your credit before these improvements, it would be a good idea to check to ensure you have an online account with each of the three credit bureaus. This will allow for a quick and painless process of unlocking and relocking your credit going forward should you need to. It will also ensure that you have the lock in place as you intended and provide you the opportunity to test out the PIN you created when you created the credit lock.

If you have not yet taken the steps to freeze your credit, the online process is now the easiest way to do so. We encourage you to take this step to protect yourself.

Second, lawmakers have passed a federal law that allows you to freeze and unfreeze your credit without being charged. This eliminated the $10 fee each agency could charge California residents who requested to freeze or unfreeze their credit. The law also provides clear timelines that credit agencies are required to follow ensuring that your credit is locked or unlocked in a timely fashion.

What is a Credit Freeze?

A security freeze or credit freeze makes it harder for criminals to use stolen information to open fraudulent new accounts, or borrow money, in your name. Once activated, credit bureaus will not release information about your accounts and payment history, which card companies and lenders use to decide whether to approve you for new credit. When you’re ready to provide access to legitimate companies to run your credit, you must “thaw” the freeze first, using a special personal identification number. There is no cost to thaw the freeze, so you can do this whenever necessary.

A couple things to keep in mind when freezing your account. Thawing a freeze takes a little bit of time, so if you plan on opening a bank account or applying for an instant department store credit card, plan ahead to avoid being denied. Also, you’ll receive fewer prescreened credit offers while your credit is frozen.

Make Sure Your Are Protected

Protecting your credit is no longer a passive activity; simply avoiding online banking and shopping will not keep your credit safe, and checking your credit score once a year is not enough. If you are wondering if it’s worth the time and effort, just talk to someone who has had their identity stolen. They will tell you that it is far easier to protect one’s credit than it is to repair it once it has been devastated by identity theft.

The amount of personal and financial data we share online is estimated by IBM to be one billion gigabytes PER DAY. It’s hardly a surprise that with that much information floating around, keeping it out of the hands of criminals has become an uphill battle.

Our Commitment To Security

At Reason Financial, data security is not only a priority, but a core value of our company. We have always protected the physical and virtual security of our client data, and we employ many advanced systems and methods to protect our clients’ data online – and offline – including file encryption, strong passwords. software-as-a-service file sharing platforms, and we engage an outsourced IT expert to keep our systems updated and secure.

If you have any questions about this, please get in touch and we can help.

Read more from The Archives

Not ready to schedule an appointment?

Stay connected. Sign-up to our newsletter