After the recent data breaches of high-profile companies, it seems many shoppers view online shopping as more risky. A new USA Today poll says that 24% of Americans have curbed their buying online because of these recent incidents. Unfortunately, even if you're a careful online shopper (or even a careful in-store shopper), you're not guaranteed to be 100% protected from identity theft or credit card fraud. So what can consumers do?
Should You Stop Shopping Online?
You don’t have to stop shopping online, but shopping smartly can help reduce your risk, and there are many ways you can do that. Whenever possible, use a credit card because credit cards typically offer better fraud protections than debit cards. Store your credit card information with as few retailers as possible. And it can help to shop with major online retailers that you absolutely know are reputable, though that’s not always a guarantee that your information won’t get stolen. That’s why you can't just stop there when it comes to protecting yourself.
How to Protect Yourself
1. Change Passwords
Whether you do it once a month, once a quarter, on your dog’s birthday or whatever, take a couple hours and change your passwords, including shopping websites you frequent and your banking and credit card institution websites. It’s a good practice to reduce your risk of having your account hacked into and your information stolen. Of course, you should also change your password for a site if it's been breached. And as tempting as it may be, don't re-use passwords across sites, because if one gets hacked, your other accounts with the same passwords could be at risk for getting hacked, too. There are various methods to creating a great strong password, so it’s a good idea to use them.
2. Look at Bank and Credit Card Statements
Check all statements that you receive from banking, credit card and online payment institutions for any suspicious activity or errors. Regularly monitor your accounts, and report anything suspicious right away. Remember that credit card companies will not hold you accountable for fraudulent charges if your credit card information has been stolen, but you need to notify them of it -- and the sooner, the better.
3. Regularly View Your Credit Reports and Credit Scores
Consumers are entitled to their free credit reports once a year from each of the three major credit reporting agencies through AnnualCreditReport.com, so it’s a good idea to take advantage of that. However, you may want to check your reports more often if you've been a victim of identity theft before. When you check your credit reports for signs of identity theft, you’re looking to make sure that all accounts listed are correct, and that there are no collection accounts for debts you did not accrue. If you monitor your credit scores regularly, and see a significant and unexpected drop in your scores, that should prompt you to check your credit reports for any problems, including identity theft. You can monitor two of your credit scores for free at Credit.com.
4. Consider Credit Monitoring and Identity Theft Insurance
Further reduce your risk of identity theft or credit card fraud by asking your insurance company about identity theft insurance. Many homeowners or renters policies can have identity theft insurance added to them for a nominal charge. Some may automatically include it. And if your information was stolen in a data breach, you may be offered free credit monitoring by the company that was breached. You can also sign up for the service separately on your own for a fee.
The bottom line: No matter what we do, we cannot be totally immune from the risk of having our credit card numbers or identity stolen. We can still enjoy the conveniences of our modern digital world, like shopping in our pajamas. We just need to be smart about it, and always keep an eye on our financial accounts and our credit reports and credit scores to stop any theft in its tracks.
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