Equifax: The Stakes Are High

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Unless you have been living under a rock for the last 30 days, you have probably heard about the Equifax data breach. On Sept. 7, Equifax, one of America’s three main credit-reporting agencies, announced that hackers had exposed vital personal identification data — including names, addresses, birth dates and Social Security numbers — of as many as 143 million consumers, roughly 55 percent of Americans aged 18 and older.

Over my career as a Certified Financial Planner, I’ve experienced global catastrophes, major market meltdowns and the housing crisis. Yet nothing has created as much confusion and uncertainty as the realization that one’s personal financial records are at risk of being compromised by anonymous cybercriminals.

This single issue is far more concerning because in today’s world one’s credit score determines if you can participate in the economy or not. Your credit score dictates whether you can take out a mortgage, borrow money to pay for your children’s education or even sign up for cable service.

The internet, as much as we are dependent on it, is still very abstract for many people. We can’t see it, touch it, feel it or even understand how it functions. And this is dangerous.

Even with the stakes this high, many people think they don’t have to worry, proclaiming: “I never buy anything online, I don’t pay my bills online, I don’t even access any of my accounts on the internet. So I’m okay, right?” Wrong.

Just because you have not participated in the internet’s benefits doesn’t mean that you are protected from its risks. If you have a bank account or a credit card, your information is on the internet somewhere.

This breach is not anything to sneeze at. If your information has been hacked, it means that all your personal account numbers on any credit card, loan or line of credit, as well as any address where you’ve ever lived, is susceptible.

On top of that, all the answers to those private security questions that you are asked to answer when you go online can be found on those same hacked credit reports.

So what should you do?

Going back to Equifax to ask them to protect your credit may make you uneasy, and I don’t blame you. As one of my clients said, “It’s like going back to a doctor that sexually abused you for your annual physical.”

Signing up with a credit-monitoring company is one helpful option. But think of them only as insurance against your losses; they fall short of actually preventing identity theft. They help to alert you to fraudulent activity, but repairing your credit is ultimately still a personal problem.

Perhaps the safest way to protect your identity is to monitor your accounts for fraudulent activity. The easiest way to do this is to link all your accounts to an online service, such as an account aggregator, that notifies you whenever a financial transaction occurs.

If you want the most up-to-date advice on how to protect your information, a more detailed explanation of your options is posted on the Georgetowner website. You can also contact me at j.e.girouard@capitalamg.com and I can walk you step by step through your options.

Author of “Take Back Your Money” and “The Ten Truths of Wealth Creation,” John E. Girouard is president and CEO of Capital Asset Management Group, a registered principal of Cambridge Investment Research and an investment advisor representative of Capital Investment Advisors in Georgetown.

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