Some people believe that a credit monitoring service is all they need to prevent identity theft. This is not actually true. What a credit monitoring service can do, however, is alert you to unusual activity regarding your credit file. For this reason, credit monitoring is not a deterrent to identity theft, but it certainly can minimize your losses due to this type of crime.
The Benefits of a Credit Monitoring Service
Credit monitoring services track the activity on your credit file. For example, the service can notify you if there is an application for a new credit account or a credit increase for an existing account. It can also notify you if there are any inquires as to the information on your credit file. These may be legitimate inquires or they may be an attempt by a criminal to review your credit worthiness.
A credit monitoring service may be a good choice for those who have already become a victim of identity theft. You can monitor your credit report for any fraudulent transactions and hopefully stop such activity before it causes you even more money.
Disadvantages of a Credit Monitoring Service
There are some instances when a credit monitoring service may not provide you with information regarding a potential threat to your identity. If an account is opened that does not report to the one of the three credit bureaus, then you may not know about the account until it enters into collection. In addition, if a different name is used with your social security number, the credit monitoring service may not be able to cross-compare this information.
Credit monitoring services can charge between $50-$200 a year, depending on the type of service you use and how many credit reports are monitored. However, there are some services that offer a free trial, which can give you a good idea of how the credit monitoring process works. If you decide that the service isn’t what you need, you will need to cancel the trial before it ends.
In Closing
While credit monitoring services may not be the best protection against identity theft, it does have its uses. Preventing identity theft begins by keeping your personal and financial information safe.