Think you’re safe? Identity theft could wipe out your entire life’s savings

Identity theft has become a pervasive issue, affecting millions of Americans each year. In 2024, American adults lost an estimated $47 billion to identity fraud and related scams, up from $43 billion in 2023.

Paula Disberry, a former Colgate-Palmolive employee, was living a comfortable life when she discovered that her 401(k) account had been drained of $750,000. The shock came when she tried to access her account online, only to find it blocked. A fraudster had impersonated her, changing her contact details and withdrawing her entire retirement savings in a single transaction. Stories like this of financial identity theft are becoming all too common. If you live in the US, likely, you’ve already encountered one—or worse, experienced it firsthand.

Think identity theft won’t happen to you? Think again

The Federal Bureau of Investigation’s Internet Crime Report for 2023 reveals that adults aged 60 and above accounted for 24.08% of all identity theft claims and suffered 41.46% of the total financial losses. While they may not face a higher risk of becoming victims, the financial toll is significantly greater than any other age group. Older adults, especially those over 60, often feel the impact more deeply. Why? They typically have more assets than younger individuals and are less likely to monitor their bank accounts daily.

An age-old scam with a high-tech makeover

Identity theft has been a concern for centuries, with one of the most famous historical imposters being Frank Abagnale Jr. Abagnale claims to have successfully impersonated various professionals in the 1960s, including a Pan Am pilot and a doctor, forging checks and documents to amass a small fortune. His alleged exploits were so notorious that they inspired the film “Catch Me If You Can.”

While Abagnale’s story is a dramatic example, modern identity theft has evolved into a more pervasive threat, particularly with the rise of digital technology. The widespread availability of personal information on the web, combined with a lack of regulation preventing companies from collecting data without consent, has made it easier for criminals to exploit personal data. The scale is massive, and the impact can severely disrupt your life and that of your family.

Red flags to look out for

Being aware of the warning signs of identity theft can help you take action before it’s too late. Here are some red flags to watch for:

Unexplained account activity: Keep an eye out for unfamiliar transactions or changes in your bank or credit card statements that you don’t recognize.

Credit report changes: Regularly check your credit report for new accounts that you did not open or inquiries from lenders that you did not initiate.

Missing mail or bills: If you stop receiving bills or other important mail, it could indicate that someone has changed your address without your knowledge.

Unexpected denials: If you’re denied credit unexpectedly, it might be a sign that someone is using your information to apply for loans or credit cards.

Strange communication: Be cautious of emails, texts, or calls asking for personal information, especially if they create a sense of urgency or fear.

Unusual password changes: If you notice changes to your online accounts that you did not make, such as password resets or security questions being altered, act quickly to secure your accounts.

Alerts from identity theft protection services: If you use an identity theft protection service and receive alerts about suspicious activity, investigate immediately.

Strengthen your defenses now

Identity theft doesn’t have to be a devastating blow. You can significantly reduce your risk by being more mindful of your online habits. Here’s how:

1) Monitor your accounts regularly: Keep a close eye on your bank and credit card statements to spot unauthorized transactions early. This can prevent financial losses and protect your assets.

2) Use strong passwords: Use complex passwords and a password manager to secure your online accounts. Strong passwords are your first line of defense against cyber threats.

3) Stop oversharing: Limit the personal information you share on social media and other platforms. It’s a treasure trove for cybercriminals who use it to craft convincing fraud campaigns targeted specifically at you.

4) Invest in personal data removal services: Given the alarming rise in identity theft cases, taking proactive measures to safeguard your personal information is essential. One effective strategy is to invest in personal data removal services. hile no service promises to remove all your data from the internet, having a removal service is great if you want to constantly monitor and automate the process of removing your information from hundreds of sites continuously over a longer period of time. 

5) Freeze your credit: Initiate a credit freeze on your credit file with all three major credit bureaus. This restricts access to your credit records, making it difficult for identity thieves to open new accounts in your name.

6) Use an identity theft protection service: Identity Theft companies can monitor personal information like your Social Security Number (SSN), phone number, and email address and alert you if it is being sold on the dark web or being used to open an account.  They can also assist you in freezing your bank and credit card accounts to prevent further unauthorized use by criminals. 

7) Use two-factor authentication (2FA): Enable this extra layer of security on your accounts to make it more difficult for thieves to access your information, even if they obtain your password.

8) Be cautious with public Wi-Fi: Avoid using public Wi-Fi for sensitive transactions or use a VPN to encrypt your online activity. Using a VPN (Virtual Private Network) service can enhance your privacy by encrypting your internet traffic, making it harder for hackers and third parties to intercept your data, especially on public Wi-Fi. A VPN masks your IP address, helping to obscure your location and online activity. While VPNs don’t directly prevent phishing emails, they reduce the exposure of your browsing habits to trackers that may use this data maliciously. With a VPN, you can securely access your email accounts from anywhere, even in areas with restrictive internet policies.

ExpressVPN and Surfshark are both trusted VPN services that prioritize your privacy and security and are available on a wide range of platforms, including Mac, Windows, iOS, Android, and popular browsers.