Your credit report is an important financial asset. It will be referred by almost everybody dealing with you, even if you are buying your car for cash! The fear of getting a hole in your report worries you. You have to protect your credit report from hackers and you can do it by a security freeze on your credit report. But is it your only alternative?
When you suspect that your credit report is being compromised by some hacker, you get a shock of your life. You have to protect your report at any cost. Financial experts suggest a security freeze as the best solution. However, it is a hard solution. It will put several restrictions on your financial activities at the same time. So when should you go for it?
Here are some circumstances under which you should seriously consider doing it –
- If your identity is stolen – If you suspect that your e-mail or financial documents are stolen, there is a possibility of misuse. To prevent bigger financial damage, it is necessary to go for a security freeze.
- If your strategic personal information is in wrong hands – If you have given your social security number or your bank’s Personal Identification Number (PIN) to someone and if you feel that it may not go in correct hands, you should immediately take an action to protect yourself.
- As a precautionary step – If you feel that you may not apply for any credit or undertake any big financial transaction in the near future, you can freeze your credit report for the time being.
- If you are a senior citizen – As a senior citizen, you may not feel any necessity to apply for new credit, you may not open any new bank account and you may not change your residence in the near future. In that case you are an excellent candidate for a security freeze.
- If you have children under the age of 18 – There is no need for these children to apply for any credit. So it is advisable to freeze their credit report.
Remember, you need to pay fees both while freezing as well as for unfreezing your report. Also, if you are planning to move, you may switch your service providers and all of them would like to check your credit report before providing you facilities. They can’t do it if you have placed a freeze.
Another point is, when you freeze your report you may not be able to do impulse buying. Unfreezing your report will take some time and the offers you are looking at may be for a very limited time.
To conclude, security freeze is a drastic measure and should be used only in selective circumstances. Some other alternatives like fraud alert or hiring a credit monitoring agency are available to you. Security freeze is not the first but the last alternative in your list.