Oh, have you heard? You can now “freeze” your credit profile!

“What does that mean?” You might ask?

Well, say someone went through your trash on garbage day, and got a copy of your credit card statement or somehow found out about your SSN, and went ahead and applied credit cards on your behalf or did something damaging to your credit rating... Crap! What would you do? You’d probably eventually call up one of the three credit bureaus (Experian, Equifax and Transunion) to report the existing damages, but how do you stop the deserves-to-be-neutered-or-spayed identity thief from opening up more accounts under your name?

My friend, that’s where this credit “freeze” comes in handy! It allows you to call up the credit bureaus and lock down your credit profile. Financial institutions or merchants normally checks your credit history prior to any account opening or major transactions, with a frozen credit report, these merchants will most likely reject any activities proposed. So, you are essentially avoiding damages before they even began! Pretty cool huh? Well, this feature is a state-regulated, and so far only California and Texas allow their residents to temporarily freeze and thaw their individual credit history. Many other states such as Vermont is following suit and in the process of passing the law similarly.

Even with such arsenal under the belt to fight identity thief, it is still a lot of hassle to go thru canceling your credit cards, calling up your bank and freezing your credit. Personally, I encrypt sensitive data on my PC and shred everything (after archiving for three years of course): credit card/bank statements, bills/pay stubs, investment letters, even credit card invitations... I love my shredder!! It is fun to see it chop everything up, a great stress-releaser.

If you have other tip on this, please share with me!