Did you know that children are even more vulnerable than adults when it comes to identity theft? Thirty five times more likely in fact. This year alone, 1 in 10 children under the age of 18 will have their identity stolen, yet most parents rarely consider this potential threat. The unblemished credit report of a child is a perfect target for identity thieves who can do an unlimited amount of damage with a new, fresh credit history. This is why parents need to be more diligent about protecting the credit of their young children now.
Thieves take over the identity of a child early on, nurture it until they get a solid credit score. They then proceed to abuse and discard it. If this fraud is not discovered by the parents in a timely manner, the fraudulent use of the child’s identity could mean the future loss of educational funding, denial of home and auto loans, as well as lost job opportunities. They will be left with no choice but to start off their adulthood at a serious financial disadvantage, because their credit had been destroyed years before they even needed it.
Child identity theft is not a new phenomenon, even in the technologically advanced world we live in today. It’s been going on for decades actually. As parents, it is your sole responsibility to protect the integrity of your kids credit rating. Here are some things that you can do to protect your child and keep their identities secure until they are old enough to manage it themselves.
Social Security Number Protection
Paperwork, whether at school, the doctor’s office or for the extracurricular activities will often ask for social security number. Before you give the number of your child, confirm if it is really necessary. If not, do not give it. It’s a rare occasion that anyone will truly need their SSN. Question their reason for asking before just handing over the number. Refrain from carrying around the Social Security number or card of your child and destroy documents containing the number.
Educate Your Kids
Make sure that you also educate your kids regarding the importance of keeping their number as a secret and see to it that they know that they should not share their social security number, phone number or address on any social networking websites like Facebook, Twitter etc. Oversharing of sensitive information is one of the easiest ways for identity thieves to get enough information to begin causing real credit damage . It doesn’t take long and it can be difficult to detect the initial fraud, because most parents generally don’t check their young child’s credit report often…if ever.
Look for Warning Signs
Does your child suddenly receive unusual mail, like credit card applications? This is a solid sign that there is something wrong with your child’s credit. When you notice something out of the ordinary like this it’s time to do some investigating.. If it turns out that your child is a victim of identity theft, take the necessary steps right away to help limit and stop the fraud from continuing.
Consider Freezing Their Credit
Not all states allow parents to proactively freeze their children’s credit before an identity theft incident has occurred. However more states are beginning to allow this practice. By freezing their credit, you prevent any creditor from accessing their credit report with TransUnion, Equifax or Experian. Not will this prevent lines of credit being opened in the child’s name, but it won’t even let a credit inquiry be placed on their credit report. You can check with each of the 3 credit bureaus about placing an extended credit freeze in your state.
TransUnion [email protected]
Monitor the Credit of Your Child
To closely monitor your child’s credit, a credit report is not really needed. In fact, your child may not even have a credit report at all. What you should do instead is to inquire at the three major credit bureaus and see if a report exists on your child. If there is an existing credit report, it is a sign that the identity of your child has been stolen and you need to contact the authorities right away. See to it that you do not order the credit report of your child because this will unnecessarily open the credit report on them.
Here at SIF, we are big proponents of credit monitoring services. Not because they help prevent identity theft, because they in fact don’t. Nothing can prevent it entirely. However, a quality credit monitoring plan will alert you if if your identity has been stolen. Being alerted that fraud is taking place gives you the opportunity to investigate and stop it from becoming an even larger problem. The best part is that companies like LifeLock and IdentityGuard have features that allow you to monitor your child’s social security number, along with yours. The monthly subscription generally cost less than $25.00, so they are worth looking into.
Never Advertise the Name of Your Child
A lot of people have those cute family decals placed on the back of their cars showing the number of the people in the family, their genders and at times, even their names. When you do this, parents unsuspectingly give the criminals some valuable information. There are even some families that put up signs in the yards that congratulate their child for the high school graduation. Not only will criminals know the name of their child but at the same time, they will know his or her place of residence. It can also put the child at risk for more of serious crimes than just identity theft
Protecting the identity of your child should be your number one responsibility as a parent. Once their identity has been stolen, there’s no going back. There’s a good chance that their credit is going to be ruined way before they are old enough to need it. And this can be a very difficult obstacle to overcome as young adult. Start taking your child’s identity as seriously as you would your own. They’ll thank you for it later.
Tim is a freelance journalist who writes on everything from personal finance to investing and credit. He spends his spare time traveling, paddle boarding and working with local charities. He has a B.A. in English Literature from Oklahoma State University and lives with his wife and children in Phoenix, Az.