Since the major data breach at Target, many readers have been asking how to best protect their credit.
"My wife and I are vigilant and we replaced our debit cards because of Target," one reader from Richmond, Va., wrote. "Our credit has been 'frozen' at the three credit agencies for years and we view the reports annually. Do you consider 'frozen' at the agencies as ample protection?"
It's likely you've heard that if you're a victim of identity theft or you want to protect your files from fraud because you suspect you are vulnerable, you should put a fraud alert on your credit files at the major credit reporting agencies -- TransUnion, Experian and Equifax. But you may not be familiar with a security freeze, a much stronger option to help protect yourself and prevent identity theft.
With a fraud alert, a business must verify your identity before it issues credit. The alert is supposed to let lenders and others know that they need to give closer scrutiny to any request under your name because something might be amiss.
You can have an initial fraud alert placed on your file for at least 90 days. For an alert that lasts for seven years, you must submit a copy of a theft report filed with a law enforcement agency to get the extended status. Both types of fraud alerts are free.
Placing a fraud alert does not affect your credit score or your credit accounts. You only need to make one telephone call because that agency will inform the other two. All three bureaus have identity-theft information on their websites -- www.transunion.com, www.equifax.com and www.experian.com.
But here's something to keep in mind -- a fraud alert isn't foolproof. It can be overlooked, allowing criminals to open accounts in your name.