2/10/2018 8:00:00 AM | Money Matters

New Year Financial Fitness: Protecting Your Credit in a Post-Equifax World

The Equifax data breach earlier this year affected nearly half of Americans, but recent surveys find that few people took new steps to protect themselves. In some ways, this was understandable. In the weeks after the hack was announced, there was conflicting information from Equifax and it was hard to reach their customer service even if you wanted to do anything.

But now that time has passed and with another major hack in the news, this time at Uber, it's the perfect moment to protect your credit to ensure your financial health.

And it may be more perfect than you realize: After the data breach, experts suggested that hackers might sit on the personal information until the publicity died down and people let down their guard, or until tax season. Here's what you can do:

Freeze your credit

Experts suggest you don't waste time trying to figure out if you were part of the Equifax hack. Simply protect yourself, starting with a credit freeze.

Unlike a credit monitoring service, which alerts you after an identity thief takes actions that might impact your credit, a freeze blocks creditors from pulling your credit file, which means they won't issue credit.

You need to place a freeze with all three major bureaus and each might charge you a small fee, but you can do it online in as quick as 15 minutes. They'll give you a PIN to unfreeze it when you need to apply for credit, but those times are pretty rare, such as when you buy or refinance a house, buy a car, open a new credit card or get a job offer, as many employers pull credit as part of a background check.

Follow these links to freeze your credit with Equifax, Experian and Transunion. Think of it as a low-cost insurance measure against credit fraud.

Check your credit report each year

You are entitled to one free copy of your credit report every year with no effect to your credit score. This is an easy way to check for any fraudulent accounts or incorrect information, and simply stay up to date on your credit.

Many sites offer credit report services but the official, government-approved one is annualcreditreport.com. If you find an error on your report, you can dispute it online through Equifax, Experian or Transunion.

If you're looking to improve your credit score in the new year, the best tip is to remember that it's a marathon, not a sprint. These tips shouldn't be surprising (especially the first one) but they're important nonetheless:

  • Pay your bills on time, every time.

  • Don't get too close to your credit limit. Experts advise using no more than 30% of your available credit.

  • Don't apply for too much credit in a short amount of time.

  • Don't close your longest-held credit cards.

Update and strengthen your passwords

Any time you hear about a major data breach or hack, you should change any passwords you have with that organization or if you use the password anywhere else. Security experts say longer passwords are better, so consider a passphrase, like "Mydaughter!wonteatcarrots76," which might be easier to remember anyway. Here are some more expert tips.

Check online and mobile banking regularly

Checking your bank account every few days should be a regular piece of your financial fitness, and mobile banking apps make it easier than ever. You can also set up balance alerts through online banking.

For more ideas on financial fitness, check out our checklist.