Preventing Identity Theft

You hear a lot about identify theft these days, and the horror stories of people who fall victim to it.

If you’re looking for some basic guidelines on preventing identity theft, check out Your Credit Advisor’s ultimate guide to identify theft. One of the problems is how often our social security number is used by companies, yet so much damage can be done when it falls into the wrong hands. How do you deal with that?

For example, my sister was getting car insurance quotes from various companies, and one wanted her SSN. Do you give it to them? When you sign up for a cell phone, most companies require an SSN as well (or require you to pay a deposit of a couple hundred dollars if you refuse).

In trying to find a solution, I came across a great article from the Privacy Rights Clearinghouse about identity theft. When dealing with companies who want your SSN:

If a business requests your SSN, ask if it has an alternative number that can be used instead. Speak to a manager or supervisor if your request is not honored. Ask to see the company’s written policy on SSNs. If necessary, take your business elsewhere. If the SSN is requested by a government agency, look for the Privacy Act notice. This will tell you if your SSN is required, what will be done with it, and what happens if you refuse to provide it. If your state uses your SSN as your driver’s license number, ask to substitute another number.

Still, it’s easy to be lax about identify theft, waving it off with thoughts of “it would never happen to me.” Like when I get a pre-approved credit card application in the mail, I just tear it in half and toss it in the garbage. No more. (You do have a paper shredder, right?)

Does anyone have tips on handling identity theft prevention and reducing the annoyance factor? Cash has a post about online bill payment and the increased security it provides — I’ll definitely look into that.