Debt Free

It’s a common nightmare these days. Someone gets access to your personal identity and opens new credit accounts in your name. With computers seemingly stolen every other day that contain copious personnel files, many people a worried that, even if they are diligent in preventing identity theft, it will happen to them. In 2005 Mastercard had 40 million customer files stolen, this year, it was the Department of Defense, and just today, Boeing reported a laptop with the personal information from hundreds of current and former company employees was horked by unknown perpetrators. 

To make matters worse, the Boeing computer’s data was unencrypted. Christ, guys, Windows XP Pro allows you to encrypt individual files or folders. You’d think the yahoos that compiled all this employee data would have at least taken that baby step toward better data protection.

Twenty five states have, or will have, beginning Jan 1, 2007 laws on the books allowing consumers to lock up their credit report. Because creditors pull credit reports when they investigate you for new credit, no credit report usually means no new account. Laws vary by state, and some states charge a nominal fee for the service, usually between $10 and $25. Typically, the freeze can be removed in less than a week, so unless you impulse shop for a new home, car or boat, you should be fine.

You’ll obviously need to remove the freeze (which may also entail a small fee) to apply for new credit accounts. So, if you wake up one morning with the burning desire to drive that new Lexus hybrid all the other guys at the studio are driving, you may have to wait until your security freeze is undone. After the freeze has been lifted, you can race down to your local Lexus dealership and open that new Toyota Motor Credit account. Come to think of it, a credit security freeze would be a great way to resist such temptations and protect your credit at the same time.

There’s no doubt that, on the path to becoming debt free, identity theft could be a big bump in the road. Look into getting a security freeze on your credit report, it may be just the ticket to a little piece of mind.