WE ARE TALKING ABOUT WAYS WE CAN PROTECT OURSELVES DURING THE HOLIDAY SHOPPING SEASON. WHY IS THIS SO IMPORTANT?
It’s the first holiday retail season in the wake of the massive Equifax breach, and it is more important than ever to be vigilant when we are shopping for friends and family. Hackers and scammers are out in force, trying to steal your personal and financial information. This morning, I want to walk through the actions you need to take to protect yourself before you hop online or head to the mall.
WHAT IS THE FIRST STEP WE SHOULD TAKE?
Before you open your browser or step out of your house, it is a good idea to take another look at your credit report. As you know Skip, your credit report contains a wealth of information about you; identifying personal information, such as your name, date of birth and current and past addresses; current and past employers and credit accounts; and credit inquiries.
It also contains public information about bankruptcies, legal judgements and foreclosures, and collection accounts on unresolved debts. When you are reviewing your credit report, you should look for any information that you do not recognize. For example, if there is an account, address, or employer that is unfamiliar, this is a big red flag and you should act! Contact the credit reporting agency immediately.
If you do not find anything suspicious on your credit report, you should go further. Following the huge breach at Equifax that exposed around half of all Americans’ financial information, I urged everyone to freeze their credit so no one could open new accounts. If you have not done so, and do not expect to apply for a mortgage or a credit card, this is a good time to do it. A credit freeze will prevent holiday fraudsters from opening any accounts during this hectic season.
IF WE SIMPLY FREEZE OUR CREDIT, ARE WE IN THE CLEAR?
Sadly, no. Freezing your credit does not prevent all fraud. Criminals can still steal your information and purchase items on your dime. When it comes to online shopping, the name of the game is prevention. First, make sure you use strong passwords. A strong password has more than 8 characters, includes a combination of letters, numbers and symbols, and both lowercase and uppercase letters. You also want to use different passwords on each site you use. If this seems difficult, or if you’re worried you won’t remember the password, use a password management program to assist you. Finally, change passwords regularly.
Next, remember not to use public Wi-Fi or a public computer to do your online shopping. You simply do not know if hackers are monitoring or accessing your information, so it is best to shop from home, from your phone on your cellular network, or use your smartphone as a personal hotspot.
There are a couple of other actions you can take. You want to make sure you are using secure websites. When logging on, look for sites that starts with “https” instead of “http” – the “s” stands for “secure” – or sites that have a padlock at the beginning of the address bar. Beware of fake shopping apps. Before downloading, check the app’s reviews, make sure they have been around for some time, and do not use apps that require you to log in through your social media accounts like Facebook. Finally, never download an app that has a very small number of users. Chances are it is not legitimate.
ARE THERE SPECIFIC PAYMENT METHODS WE WOULD BE BETTER OFF USING?
Great question, Skip. How you pay for items plays a big role in secure shopping. Avoid using a debit card online, or linking your bank account to any site. Instead, try to use credit cards or secure payment platforms like PayPal. These methods provide buyer protections in place, meaning you will not be on the hook for fraudulent charges, and they are less likely to expose critical information, like your bank account number. Gift cards are also a better option than debit cards online.
ANY FINAL TIPS?
My final tip is to practice good financial habits when you are doing your shopping! Build a budget and stick to it. Do not open high interest credit card accounts that you will be paying for after the holidays are long past! You will be thankful come January. I hope everyone has a very Happy Thanksgiving!
Mellody Hobson is President of Ariel Investments, a Chicago-based money management firm that serves individual investors and retirement plans through its no-load mutual funds and separate accounts. Additionally, she is a regular financial contributor and analyst for CBS News.
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