They say that the first million is the hardest to make, it’s also the hardest to keep.
Our goal here at Money Morning is to deliver an advantage to our readers.
The advantage often comes as we point out opportunities in the market that other investors simply don’t, giving you an idea of how to turn those situations into profits.
But in other cases, we are here to tell you how to avoid a dangerous situation to help protect your assets.
That is my goal today.
Last week, it was reported that almost three billion social security numbers had been compromised along with other financial data.
It’s a nightmare situation… Spend years of savings and investing to open your account one day and have it cleared out? Probable, maybe not. Possible, ABSOLUTELY!
We’ve grown into an age where your data and privacy have become the price of convenience.
Credit cards, online banking, online investments, shopping, etc… the more convenient, the more data you must give and the bigger the risks.
It’s truly a double-edged sword.
There is a way to completely avoid the risk of having your online data stolen…. But you wouldn’t be able to read what I’m writing today without a computer, right? You get the idea, we’re not going cold turkey from technology.
But when you think about the simple numbers, nearly 3 billion people means that almost everyone is at risk here.
Last Wednesday, news broke that National Public Data had experienced a data breach. This was the big one, or at least the biggest so far, with 2.7 billion records having been swiped by hackers.
The Department of Justice reported that according to screenshots, the hackers were providing the data for sale on the “dark web”. Everything was up for grabs. Names, date of birth, social security numbers, addresses. Everything it would seem except for usernames and password.
Now, when I hear the term “Dark Web” I often turn a deaf ear as I feel like most of you probably do “I’m not important enough to have my data for sale on the dark web”. WRONG.
This is what I got two days later…
This was the email that changed my thinking. I went from being very cautious about my online data to aggressively protecting my online data.
I had already deployed a credit/identity tracker months earlier after being informed that my data was involved in a breach at AT&T. Since then, it’s been an interesting exercise to watch the activity that involves your social security number and your credit score.
But last week’s breech hit a little closer to home with the short time that it took for hackers to reach out and touch my personal data life and then sell that information with lightening speed.
Remember that this vulnerability won’t go away. You’ve got to remain vigil when it comes to protecting your data. Account numbers, usernames and other online “keys” will change over time, but your social security number, birthdate and other personal information don’t change.
Here are the Three Things I’ve Done
A banker friend told me to “freeze it all”. Credit cards, bank accounts and credit cards, but most importantly freeze my credit.
Freezing your Credit is the Strongest Response to a Potential Data Breach of your Data.
Freezing your credit, also known as a security freeze, will prevent credit reporting agencies from releasing your credit report to others. This helps to prevent identity theft because new credit accounts can’t be opened without checking your credit history.
Freezing your credit is simple and only takes a few minutes and its FREE.
You can freeze your credit by contacting each of the three credit agencies online, by phone or by mail.
I found the easiest to be using each company’s online process that included opening an account, verifying my personal information and then following the procedure to freeze my credit accounts.
You can reverse this when planning to apply for a loan or other transaction that would require access to your credit bureau reports. Outside of that, you’ve shut down the ability for someone that is trying to steal your credit to open new accounts.
Take it a Step Further and Freeze Your Cards
Most credit cards have a feature that will allow you to manage your card through an application on your phone. You can pull up balances, make payments and freeze the card as well.
Make it a habit of freezing all your credit cards. The apps make it simple enough to “unfreeze” the account just before you plan to use it to pay for a dinner or make a purchase. As soon as you’re done, freeze the card again.
This will avoid any unauthorized charges on the credit card.
There are plenty of them out there, Experian Creditlock, Lifelock by Norton and Aura are just a few of the services out there.
Make sure that you go through the benefits of each before deciding. Frankly, you can almost duplicate the results of using one of these services by signing up for a free credit monitoring system like Credit Karma or Experion’s free monitoring service. You’ll have access to your credit score as well as notices when a new account has been opened. But you will miss out on a few perks.
Dark web monitoring, insurance against losses if your identity is stolen and other conveniences make the $30/month fee palatable.
Pro tip: If you’ve received notice that your data has been breached you will also receive an offer for one of these services without cost for up to two years.
Use these services diligently and you will come as close as possible to having locked your identity and credit down like a pro.
This is the hardest, seriously.
Ten years ago, we all did the same thing. Some combination of birthdays, kids names and address to create a jumble that we thought nobody could guess. Guess what, they can.
My Netflix account was hacked last year. It was innocent, I just noticed a new profile and thought one of my kids had added it. It had a generic email address and name.
I asked them… Nope. When questioned, they wondered why the profile was there too.
I deleted the profile, then changed my password and told the kids to do the same. I asked a tech friend of mine “why would someone do that?”. Because we use similar usernames and passwords everywhere, including those high value bank and brokerage accounts.
Slap of the head later and I’m changing every password I access for the next month. And I still don’t feel safe.
My recommendation – and I am not being compensated for this at all – is that you use a quality password manager. A good password manager will store your username and passwords for the sits that you give it permission to do so with. That data will remain encrypted in their system and is available for your use through a secure application.
Even better, you can set your passwords to automatically update after a certain number of days that is your choice.
And no more birthday/address combinations, the application – Dashlane in my case – will automatically generate random passwords that look like this “KzSge4H$7KE$TY9j4n7bKQ#88Tn”, automatically storing them for the next time you log on to whatever website you are visiting.
Sure, there is a cost (around $60 a year for a family), but the convenience and extra security are far more valuable that the investment in secure passwords.
There you have it.
Like I said earlier, we’re here to help you find opportunities to make money in the market, but today the risks
