In 2025, the Federal Trade Commission received 1.4 million identity theft reports. The total financial loss from identity theft and fraud exceeded $10 billion. And those are just the reported cases -- the actual numbers are certainly higher. Identity theft is not something that happens to other people. One in three Americans will experience some form of identity theft in their lifetime. The good news: a handful of straightforward preventive measures blocks the vast majority of attacks. Here is exactly what to do.
Freeze your credit at all three bureaus. This is the single most effective thing you can do, and it is free. A credit freeze prevents anyone (including you) from opening new credit accounts in your name until you temporarily lift the freeze. It takes about 10 minutes to freeze all three: Equifax (equifax.com/personal/credit-report-services), Experian (experian.com/freeze), and TransUnion (transunion.com/credit-freeze). You will get a PIN for each bureau to lift the freeze when you legitimately need to apply for credit. This one step prevents the most damaging type of identity theft: someone opening loans or credit cards in your name.
Use a password manager and unique passwords for every account. The most common way accounts get compromised is password reuse. If your email and password leak from one site (and data breaches happen constantly), criminals use automated tools to try that same combination across hundreds of banking, shopping, and financial sites. A password manager like 1Password, Bitwarden, or the built-in options in iOS and Chrome generates and stores unique, strong passwords for every account. You only need to remember one master password. Enable two-factor authentication (2FA) on every account that offers it, especially your email, banking, and investment accounts.
Monitor your accounts weekly. Set up transaction alerts on all bank accounts and credit cards so you get an immediate notification for every purchase. Most banks let you set thresholds (alert me for any transaction over $1, for example). Check your credit report at AnnualCreditReport.com regularly -- you are entitled to free weekly reports from all three bureaus. Look for accounts you did not open, inquiries you did not authorize, and addresses you do not recognize. The faster you catch fraud, the easier it is to resolve.
Protect your Social Security number like it is your most valuable possession -- because to identity thieves, it is. Never carry your Social Security card in your wallet. Never give your SSN to anyone who calls you (legitimate organizations will not ask for it over the phone if they initiated the call). Be skeptical of any request for your SSN -- ask why it is needed and whether an alternative identifier can be used. When filing taxes, do so as early as possible to prevent a thief from filing a fraudulent return using your SSN and collecting your refund.
If you become a victim: Act immediately. File a report at IdentityTheft.gov (the FTC's official recovery resource). This creates a personalized recovery plan and generates an Identity Theft Report you can use with creditors. Place a fraud alert on your credit reports (one call to any bureau alerts all three). File a police report if there are financial losses. Contact each financial institution where fraud occurred. Under the Fair Credit Billing Act, your liability for unauthorized credit card charges is limited to $50 (and most issuers waive even that). For bank accounts, liability depends on how quickly you report -- within 2 business days limits you to $50, within 60 days limits you to $500. Beyond 60 days, you could lose everything. Speed matters.
