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How to Protect Yourself in the Age of Data Breaches

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Recent headlines about data breaches at Target, Neiman Marcus, and now a number of hotel chains have many consumers on edge, wondering when the next breach will occur and if their information could be at risk.

“No matter how cautious we are as consumers, the security of our personal information is always at risk,” says Adrian Nazari, founder and CEO of Credit Sesame. “We may not be able to prevent a data breach from happening, but we can take steps to protect ourselves and limit the damage if it does.” Here’s a look at several of these steps.

1. Use a credit card

With credit cards, you cannot be liable for more than $50 of fraudulent activity, and most card issuers offer zero liability protections that waive this fee if your card is used fraudulently. With debit cards, however, your liability jumps to $500 if you don’t report the fraudulent charge within two business days. “With a debit card being directly tied to a checking account, cardholders have the additional frustration and inconvenience of waiting on the bank to investigate and return the fraudulently used funds,” Nazari says. If you can trust yourself not to overspend on a credit card, it’s probably smart to use credit over debit.

2. Change your debit card PIN

If you must use a debit card, it’s a good idea to change your PIN at least every quarter to thwart potential fraudsters. If you used a debit card at Target or Neiman Marcus, change your PIN immediately. And never share your PIN with others or use a combination of numbers that’s easy to guess, like the year you were born.

3. Check your statements and monitor your credit and debit accounts

Your best defense against fraud is carefully reviewing your statements for transactions you don’t recognize. Services like BillGuard can help alert you to suspicious charges, but it’s also a good idea to go through your statements line by line and notify your card issuer immediately if you spot any unfamiliar charges. Nazari even suggests taking this a step further; “The quickest, most effective way to identify fraudulent activity on your accounts is to monitor and check your credit and debit account transactions regularly. If you can, don’t wait until your statement arrives to check for unusual activity or unauthorized charges.”

4. Check your credit reports regularly

In the age of data breaches, it’s also a good idea to check your credit reports regularly for any unusual activity, such as credit inquiries or new credit card or loan accounts that you didn’t apply for. These signs are often indicative of true name fraud and identity theft, where a fraudster uses your personal identifying information to obtain credit in your name. Checking your credit reports regularly can help you catch and address these thefts sooner rather than later. You can also utilize services like CreditSesame.com, which offers free credit monitoring and access to your free credit score every month.

5. Be wary of emails

The recent Target breach involved not only card information but also mailing addresses and emails. When that happens, fraudsters sometimes send out phishing emails mimic those from your bank or a retailer you trust and try to convince you to enter your login information so it can be stolen. Instead of clicking an email link, type in the real bank or retailer’s website yourself and log into your account to see if there’s anything requiring your attention.

6. Replace your card if there’s fraudulent activity

With every passing day there seems to be news of another data breach hitting headlines, but this doesn’t mean you have to immediately replace your card. However, if you do spot fraudulent activity, report it immediately and ask the issuer to send you a replacement card. Updating all of your subscriptions and reoccurring accounts with a new credit card number can be a hassle but if your information was compromised in a breach, the temporary inconvenience is better than the longer term risks and chances of fraudulent charges down the road. And in many cases, if your information was compromised in a data breach, your bank or card issuer may automatically issue a replacement card as many issuers have done with the latest Target breach.

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