You have heard the news reports about the Equifax data breach. You should assume that your personal information is in the hands of criminals. You have also heard the instructions to “freeze your credit,” but many Americans are confused or intimidated by this process.

Combining the best advice from consumer advocates Jean Chatzsky, Dave Ramsey and Clark Howard, here is what you should do about your personal information.

  1. Monitor your credit yourself.
    Use www.annualcreditreport.com.  Don’t use the others – they are not free. This is the free one mandated by the government.
  2. Monitor your credit through creditkarma.com or quizzle.com.
    It is free.  Fraud alerts are of limited value. CreditKarma.com has a free monitoring service. They make their money through advertising by showing you credit card offers. They do not bother you and send you stuff constantly.
  3. Freeze your credit.
    Here is Clark Howard’s guide to credit freeze including the links to the three bureaus so that it can be done in a matter of minutes: http://clark.com/personal-finance-credit/credit-freeze-and-thaw-guide/.  You must freeze all three bureaus.  It’s the best protection you can have, but not foolproof – Dave Ramsey reports that some companies will issue a credit card without checking your credit.

    1. All existing credit will continue to work – the only change is when you or someone pretending to be you applies for new credit. New applications will not go through and cannot be approved! That stops the criminals who try to use your name and number.
    2. In Alabama, it costs $10 per bureau. Equifax is currently providing this service free. Everyone in your family must also apply and pay to freeze their credit.
    3. When you want to apply for a loan or credit, you need to first thaw your credit.  When you freeze your credit, you will receive a pin number. You will use the pin to thaw your credit.  If your pin number is readily available, credit can be thawed in 5 minutes.  It can be thawed for any length of time – days, weeks, a month, for example.  At the end of that time, it will go back to being frozen.
    4. Applying for a home loan will involve thawing all 3 bureaus for both husband and wife.  When applying for other credit, you can ask the merchant or issuer what bureau they use and only thaw that one.
    5. Keep your pin numbers in a very safe place that you will always remember.  If it is lost, it will be a hassle to obtain new pin numbers.
    6. If you apply for some kind of change with an existing provider, you will not have to thaw your credit – such as upgrading your cell phone with your existing carrier.  You will have to thaw your credit when you change carriers.

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