7 Strategies to Handle the Equifax Data Breach

By now, you’ve likely heard the news that Equifax had a data breach that affected 143 million Americans.  

Critical information was stolen including dates of birth, Social security numbers, addresses, and even credit card numbers and driver’s license numbers. While credit breaches are occurring with increased regularity, this one is more alarming because of the sheer amount of data stolen and the sensitive nature of the stolen data. That concerns me, but there are steps that you can take to protect yourself. Read this article to find out what they are...

The following post is by MPFJ staff writer, Melissa Batai. Melissa is a freelance writer who covers topics ranging from personal finance to business to organics to food.  She blogs at Mom’s Plans, where she shares her family’s journey to healthier living and paying down debt.

By now, you’ve likely heard the news that Equifax had a data breach that affected 143 million Americans.  Critical information was stolen including dates of birth, Social security numbers, addresses, and even credit card numbers and driver’s license numbers.

Equifax has set up a site where you can check to see if your information was compromised, but use caution here.  You’ll have to enter your name and the last six digits of your social security number.  If you’re not comfortable doing that (I’m not), just recognize that chances are good you are one of the millions affected.

While credit breaches are occurring with increased regularity, this one is more alarming because of the sheer amount of data stolen and the sensitive nature of the stolen data.  Basically, a thief, armed with your stolen data, now has exactly what he needs to impersonate you.  That concerns me, but there are steps that you can take to protect yourself.

Equifax Data Breach Management Strategy # 1 - Freeze Your Credit  

My husband and I froze our credit nine years ago, and though it can be a nuisance to thaw our credit when we open a new account, I’ve never been more glad to have it frozen than now. When you freeze your credit, no one, not even you, can open an account in your name unless you thaw your credit first.  To thaw your credit, you need to pay a small fee and use a special pin number.

If you have not done so already, I highly recommend that you freeze your credit.  This is your first, and perhaps most important, line of defense.  However, be advised that freezing your credit does cost money depending on the state you’re in, and it also costs money to thaw it. Usually, the fee is $5 to $10 for each of the 3 major credit bureaus, Transunion, Equifax, and Experian.  Once you freeze your credit, keep your pin in a safe place, as you will need it to thaw your credit.

In the future, when you want to take out a car loan or open a new credit card, simply ask the attendant what credit bureau they use to run your credit report.  Thaw your credit from that bureau only; then you will only have to pay $5 or $10 instead of $15 to $30 that you would have to pay if you just thawed your credit from all three bureaus.  You can leave your credit open for a period of your choosing (we usually leave it open for a week or two), and then it will automatically freeze again based on the date you choose.

Equifax Data Breach Management Strategy # 2 - Sign Up for Credit Monitoring and Identity Protection

If you’re not ready to freeze your credit, you can sign up for credit monitoring and identity / identity theft protection.  The credit monitoring company will notify you if someone inquires on your credit or tries to open a new account. 

There are two disadvantages to credit monitoring.  Thieves can still open an account in your name, but you’ll find out about it quicker than if you did not have credit monitoring.  However, you’ll still need to go through the hassle of trying to prove the account is fraudulent and recoup your money.  In addition, you have to pay monthly for credit monitoring for the majority of services (however, there are some free services, as noted below).  If you freeze your credit, no one can open an account for you, and you do not have to pay a monthly fee.

If you want to sign up for credit monitoring, you may not want to take advantage of the credit monitoring service Equifax is offering.  For one thing, when you sign up for credit monitoring, there is a disclaimer that you will not be able to be part of any lawsuit that comes as a result of this credit breach; simply put, you limit your legal rights.  Second, while Equifax gives you this service for free for a limited time, you will be paying the monthly monitoring fee after a time.

Equifax Data Breach Management Strategy # 3 - Fraud Alert

You can call each of the credit bureaus and set a fraud alert, which will be valid for 90 days.  When you have a fraud alert on your account, a business must verify your identity before they open an account, so they will contact you.  A fraud alert is free, but after 90 days, you will need to put another fraud alert on your account.

Equifax Data Breach Management Strategy # 4 - Order a Credit Report Every Four Months  

Every person is eligible for a free credit report from each of the three credit bureaus every 12 months at annualcreditreport.com.  Maximize this resource by ordering a credit report from one credit bureau, and then four months later from another credit bureau, and four months later from the last one.  By doing this, you’re able to review your credit report every few months for free. 

While this won’t stop thieves from opening an account in your name, you will know within a few months if it has happened.  I wouldn’t rely entirely on this method, but it is an excellent supplement to whatever other method you choose to protect your credit.

Equifax Data Breach Management Strategy # 5 - Order Credit Reports for Your Kids  

Kids are perhaps most vulnerable in this situation because no one typically thinks to check childrens’ credit until they need to use it, perhaps at 18 or later.  In most cases, children won’t have a credit report, but kids 13 and older may have one if they have a joint account with you or if someone stole their identity.  I’d recommend trying to order credit reports for your children 13 and older when you order your own credit reports from annualcreditreport.com.

Equifax Data Breach Management Strategy # 6 - File Your Income Tax As Early As Possible  

​While the above steps help limit fraudulent credit activity, there is still one instance that you’re vulnerable to now that such personal data has been divulged—income tax fraud. 

This year, and most years after, you should make it a priority to file your income tax as early as possible so a thief doesn’t beat you to it, stealing your income tax refund.  If your income tax return is stolen, you can work with the IRS to remedy the situation, but you’ll have to wait months, or in some cases, even a year or more, to get your refund.

Equifax Data Breach Management Strategy # 7 - Keep an Eye on Your Medical Identity  

Unfortunately, most Americans are now vulnerable to medical identity fraud.  A thief can try to get care in your name, perhaps using your insurance.  This can lead to many issues beyond the financial.  What if a thief has a different blood type than you, and his blood type is now on your electronic record?  In an emergency, how do medical personnel know which type is yours?

Conclusions

With so much of our information housed at the credit bureaus, this breach is a catastrophic one.  You can be vigilant about not using your Social Security Number whenever a form asks for it and shredding all of your documents, but no amount of vigilance on your part can protect you when a large company has a credit breach.

Instead, you’ll need to be proactive and take some immediate steps, including freezing your credit and adding a fraud alert, just to name a few, to protect yourself.  And although it doesn’t help you protect your identity, be advised that there is already a lawsuit pending against Equifax for this breach.  Perhaps if the penalty is high enough, businesses will do a better job protecting our sensitive data.

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