The Truth About Identity Theft Protection and Credit Monitoring: Do They Really Work?
Identity theft is a growing concern for everyone as it can cause serious financial and emotional damage. Companies that offer identity theft protection and credit monitoring services claim to protect your identity and credit score by constantly monitoring your personal information and alerting you to suspicious activity. These services can be expensive and it is important to understand whether they are worth the investment.
While they can certainly provide an extra layer of protection, it’s important to note that no service can guarantee 100% protection against identity theft. Additionally, there are many steps you can take to protect your identity, such as checking your credit reports regularly, watching out for phishing scams, and creating strong passwords for all your accounts. Ultimately, it is up to each individual to decide whether the cost of identity theft protection is worth the peace of mind it provides.
What is identity theft protection?
Identity theft protection is a service provided by financial companies designed to protect your ID from theft and thus prevent the inevitable fraud that follows.
They typically offer three things:
- Monitoring: your credit files are checked for changes.
- Warnings: you will receive a notification of new accounts opened in your name or unusual expenses.
- Recovery: Identity theft protection comes with an insurance element that covers the recovery of lost bank and card balances and the impact of other fraudulent activity on your name.
You may receive regular emails about identity theft and other privacy-related news if you sign up for a security service.
Who offers credit monitoring?
If you have decided to pay for credit monitoring, you have several options. As identity theft has increased in recent years, the number of security solutions has increased.
Where you are located determines which credit monitoring solutions are available to you.
For example, if you’re in the US, Norton LifeLock, ID Watchdog, and Identity Force offer comprehensive paid services with different coverage options, with matching monthly and annual subscriptions.
Need something less extensive? Credit Karma is a free service that checks for changes to Equifax and TransUnion reports. This service sends alerts and recommends financial products based on your credit information. As such, it is an all-in-one credit care tool.
Credit monitoring from Credit Karma is that too available in Great Britain.
Disadvantages of Identity Theft Protection
Which identity theft protection service you choose mainly depends on your expectations and budget.
Although all the big names promise a lot, unfortunately they have too many differences. ID Watchdog’s premium protection offers fewer services than IdentityForce, so it’s worth researching which product is best suited for you. For example, IdentityForce UltraSecure+Credit and LifeLock Ultimate Plus offer family plans, while ID Watchdog does not.
Then there is the issue of trust, reliability and transparency.
While for example Lifelock Ultimate Plus insurance is designed to reduce the exposure of your data, monitor the Dark Web for your data and protect stolen money, this is not without its problems. Recent data breaches at LifeLock and Equifax may make you wonder whether they can be trusted.
Finally, these services offer their products in different price categories.
How does credit monitoring work?
Credit monitoring is an essential part of identity theft protection services. It involves checking your credit information for any changes and alerting you if unexpected activity occurs. The basic idea of credit monitoring is to maintain your credit file using data from all available credit agencies. Some companies also offer additional features, such as checking to see if medical care is being received in your name and different levels of insurance protection. Notifications can be sent via email or SMS. However, it is important to note that credit monitoring is essentially a paid service that allows you to have your credit information checked. You can still check your credit information, so you may want to consider whether or not you should pay for credit monitoring.
You can protect your identity for free
While paid solutions seem more and more common, you may prefer to protect your identity for free. With several free-to-use tools and services, you can check your credit and protect your ID for as little as the cost of your Internet connection.
- Track changes to your credit score: Card issuers and some personal finance websites (e.g. Credit Karma) can help you keep an eye on your credit report for free.
- Report Identity Theft: Government and financial institutions already offer free reporting tools, so you don’t have to pay for this service.
- Freeze your credit file: perhaps the most valuable tool against identity fraud; you must keep your credit file frozen if you do not apply for credit.
Does credit monitoring work?
Identity theft is a common problem today and credit monitoring is a way to keep an eye on your credit status and reduce the risk of identity fraud. However, it is important to know that credit monitoring only works if you actively pay attention to your financial situation and regularly check your credit file. It is crucial to read the warnings from credit monitoring services and take the necessary steps to prevent identity theft.
When it comes to choosing an identity theft protection company, it is essential to do your research thoroughly to ensure that the company provides reliable and effective services. It is advisable to consult reviews of the service to see whether it meets your requirements in practice. Ultimately, the effectiveness of identity theft protection depends on the quality of the service provider.
Should you pay for identity theft protection and credit monitoring?
Can you afford the monthly expenses for credit monitoring? Protection seems like a good idea if you’re worried about identity theft, but is the risk real? Is it worth paying to avoid this? And can paying to stop identity theft prevent it?
Identity theft protection services are primarily affordable and can give you good results. But there’s no good reason to pay for a service that replicates most of the things you can do for free.
Ultimately, if you’re willing to pay and can afford it, it can’t hurt. However, it’s fair to say that subscription identity theft protection and credit monitoring are little more than digital placebos. You can get better results for free with SMS alerts, improved awareness and vigilance, and better security practices.