Protect Your Finances: Easy Steps to Help Prevent Fraud

The best way to reduce your risk of fraud is to never, ever give out your PIN or password and to avoid opening any texts or emails you weren’t expecting. These two strategies alone will save you a lot of time and hassle.

That said, we are seeing more fraud attempts from various sources, and minimizing the risk can feel overwhelming. Here are three additional ways to significantly reduce your chances of financial exploitation by a fraudster. Two are free, and one has a modest fee. Together, these approaches help you stay responsible and disciplined in protecting your finances.

I have likely mentioned this to you before, but during a recent review, I realized that while I may have provided the steps, I have not made them as convenient and simple as I should by including direct links and phone numbers. These are straightforward measures that do not take much time to set up.

Use a Monitoring Service

A monitoring service such as LifeLock alerts you to new credit applications, suspicious activity, and changes in your personal information. There is a fee, but some find the updates and potential reimbursement for identity theft–related losses worthwhile.

There are many similar services, so you may want to compare your options. LifeLock, for example, offers a family plan that allows you to add a spouse. Though these services can cost a few hundred dollars a year, many consider them worthwhile. They monitor any information you choose to include, such as your Social Security number, bank accounts, or driver’s license number. Visit https://lifelock.norton.com/ or call 800-416-0599.

Freeze Your Credit

Freezing your credit is free and prevents lenders from accessing your credit report without your permission. Sometimes, credit bureaus require you to renew this annually, or they may say you must have experienced fraud before you can freeze. Both scenarios are simple to handle. If you need to renew annually, you could do it when you file your taxes as a convenient reminder. If you’re asked to show prior fraud but have not experienced it, you can state that you receive many scam emails, which most people do. Freezing your credit helps prevent unauthorized accounts in your name. You need to contact each bureau separately.

• Equifax: equifax.com or call 1-888-766-0008

• Experian: experian.com or call 1-888-397-3742

• TransUnion: transunion.com or call 1-888-909-8872
  

Add an IRS PIN

An IRS Identity Protection PIN helps confirm your identity when filing tax returns, reducing the chance that someone else can fraudulently claim a refund in your name. More information is available at the IRS IP PIN page.

This one is likely the biggest hassle of these three steps, though it is just as important as the others. Filing fake tax returns and obtaining someone’s refund is a growing concern. Adding an IRS PIN significantly reduces the likelihood of a fraudster claiming your refund.

These steps bring minor inconveniences. When you apply for new credit or a lender checks your report, you must unfreeze your credit temporarily (often for 24 hours). You’ll also need to provide your IRS PIN to your tax preparer each year. These minor hassles are still preferable to fixing a fraud situation.

No plan removes all risk, but this approach significantly lowers your odds of becoming a victim. These steps align with PlanAssist® principles of staying responsible and disciplined. If you want help with any of these steps, let me know. I’m happy to schedule a Zoom call to walk you through them. It’s often simpler to address potential threats before they become costly problems.

DISCLOSURE - All written content on this article is for information purposes only. We utilized ChatGPT and other sources for this article. Opinions expressed herein are solely those of Core Wealth Consultants. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. Core Wealth Consultants, LLC a Registered Investment Advisor in the States of Florida, Indiana and Michigan. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Diversification and asset allocation does not assure or guarantee better performance and cannot eliminate the risk of investment loss.