
If you’ve ever been a victim of identity theft, you know how important safeguarding yourself is. With recent breaches at National Public Data and Change Healthcare, going the extra length to protect yourself is crucial. There have been calls for freezing credit to get people to safeguard their financial information. But should you freeze your credit? Find out here!
Overview of Recent Data Breaches

Cyber-attacks have recently been recorded at National Public Data and Change Healthcare. Due to these data breaches, millions of personal records were compromised, highlighting the vulnerability of a substantial proportion of Americans’ data. This is scary, as no one wants to fall victim to identity theft.
Definition of a Credit Freeze

A credit freeze (Security Freeze) is a process designed to instantly restrict entry to your credit statement, making it harder for identity bandits to open new accounts in your name. This means you—or others—can’t open a new credit account during the freeze period. Also, creditors are blocked from being able to review your credit reports until the credit freeze has been lifted.
How Do Credit Freezes Protect You?

Yes, we know it’s a question on your mind, just like everyone else who had to process a credit freeze amidst data breaches or cyberattacks. So, what does it do? It’s simple—It prevents unauthorized credit checks on your account and blocks identity theft. At the same time, it protects your financial security and gives you peace of mind amidst data breaches.
Understanding the Risk of Data Breaches

You should pay attention to this because a single data breach can turn your life upside down. It can compromise sensitive information, leading to financial exposure. These risks include loss of sensitive information, financial fraud, and long-term credit damage, which can affect your chances of securing a loan for business or personal use.
Impact of Breaches on Credit Reports

The most significant impact of this kind of exposure is dire, as it could lead to potential misuse by fraudsters. Once they get a hold of your government-approved name, phone number, contact address, and even social security number, the ripple effect is unpredictable. Loans and illegal operations that could land you in hot soup.
How to Freeze Your Credit

By now, you know it’s wise to freeze your credit when there is a report of constant breaches. And do it for safety reasons. But how do you even go about it? It is simple: contact the three major credit bureaus, Equifax, Experian, and TransUnion, to request a freeze. The best part: it won’t cost you a dime.
https://www.cnbc.com/select/what-are-the-three-credit-bureaus/
How to Lift a Security Freeze on Your Credit Report

After the dust settles, you might want to acquire a quick loan, but then you remember your credit is frozen. Frustrating, right? Calm down; here is the trick, and it’s not a big deal if you know how to lift it. Contact the credit bureau agencies or visit their website to complete the lifting process.
The Benefit of Freezing Your Credit

Let’s assume you have a motorbike, and it gets stolen. One thing is for sure: the thief would use the motorbike elsewhere, or they would find a buyer of the stolen bike. If you relate that to a hacker breaching your credit reports, they can apply for a credit card in your name.
The Limitation of Freezing Your Credit

Of course, freezing your credit has limitations. The process can be inconvenient, especially when you need quick access to credit or loans after a freeze. Lifting the freeze temporarily can take time and might even require going the extra length, which is stressful. More paperwork is needed to prove you are not at risk anymore.
Alternatives to Freezing Your Credit

Cyberattacks are scary; therefore, you should find ways to protect yourself against them. As mentioned, freezing your credit is a great way to combat data breaches, but what other alternatives can you try? You should consider setting up fraud alerts or using credit monitoring services.
Credit Freeze vs Fraud Alerts: What’s the Difference?

They are both helpful in protecting you against identity theft. However, unlike credit freezes, fraud alerts do not block access but warn creditors to verify their identity before opening new accounts. This process is way more flexible than entirely freezing your credit. You can get a free copy of your credit report any time you place a fraud alert.
When Should You Freeze Your Credit?

Deciding when to freeze your credit is relative to a person’s financial situation. But we suggest freezing your account when you’re not actively applying for credit or loans. If you need credit or loans to pay bills or fund a business, it’s best to avoid freezing your account.
Best Practices For Protecting Your Credit

To maintain your financial security, constantly monitor your credit report. Be alert and cautious of phishing scams on the internet, as you can easily fall prey to cyberattacks if you’re negligent. Finally, always use strong passwords to protect your accounts or use 2-factor authentication if necessary.
Will a Credit Freeze Impact Your Credit Score?

No one wants to make decisions that can impact their credit score, so I understand why you might be reluctant to freeze your credit. If you feel it would affect your credit score, you should think again. A credit freeze won’t pause changes in your credit score, so no need to worry.
Can You Freeze Your Credit Permanently?

Theoretically, yes, you can. Due to the constant data breaches lately, many are considering having it as a default. While it’s not an ideal thing to do, it ensures you’re well-protected against identity theft at all times. If you ever do this, you only need to request a temporary unfreezing of your credit when applying for a loan and credit card.
Making the Decision

Data breaches are dangerous, and until you have experienced them, you can’t realize what can happen or how serious they can be. With data breaches becoming more frequent, the need to freeze your credit can’t be overemphasized. It’s a proactive step to protect your financial well-being.