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Finally: Freeze Your Credit, Fee-Free

It’s been one year since the infamous Equifax hack, which exposed nearly 145 million Americans’ personal information, including Social Security numbers, drivers license information, and more. While some have discovered since then that they’ve become vulnerable to the nightmarish reality of fraudulent charges or identity theft, for most Americans this event served as a wake-up call of the highest order: warding off increasingly clever cybercriminals requires constant vigilance.

One of the most important and effective ways consumers can help to protect against cyber fraud is to place a “freeze” on their credit. This keeps the credit reporting agencies from releasing information about their credit worthiness to lenders, which makes it much more difficult for criminals to open any new fraudulent lines of credit (like opening new credit cards or applying for loans.)  

The only catch? Some states require its citizens to pay a fee every time they freeze or unfreeze their credit. This can be a cumbersome, if not costly, point of friction that might even prevent some consumers from behaving more diligently about monitoring and taking ownership over their credit status.

The good news is that a new law removes this fee, making it much easier to enact credit freezes and protect against cyber theft. While this law financially incentivizes consumers to freeze their credit, it’s still a clunky process, as you’ll need to contact each of the three major credit bureaus separately to enact individual freezes.

That said, freezing your credit is still a powerful way help to guard your identity and assets. Equifax has already begun offering fee-free credit freezes, while TransUnion and Experian have yet to announce when their waived fees will take effect.

If you still have lingering questions over the Equifax breach and its impact on your current finances, talk to your Financial Advisor to establish a course of action unique to your circumstances.

Learn more about the author, Ronsey Chawla, MBA, CFP®.