Kiplinger Today


How to Keep Your Data Private

Americans trying to maintain their privacy these days can be forgiven for feeling a little vulnerable. Every few weeks brings news of another huge security breach compromising the credit or debit information, passwords, e-mails, or other personal data of shoppers, hotel guests, college students or employees -- in short, just about everyone.

See Also: Is Your Identity at Risk?

As if our most sensitive financial (or medical) data falling into the hands of thieves isn’t enough to worry about, privacy advocates now tell us that we must worry about all of our data -- all of the snippets that make up the massive trove of (sometimes erroneous) facts and inferences about us, pieced together from public and nonpublic information, and from our behavior both online and off. These shadow profiles can affect what we pay for goods or serv­ices, and limit the opportunities we’re offered, financial and otherwise.

In addition to these pressing personal privacy concerns, there’s a growing unease about U.S. government surveillance, following revelations of massive National Security Agency (NSA) dragnets of cell-phone logs, location data and e-mail contacts. The news has spawned widespread interest in products and services that were formerly the province of sophisticated techies, as ordinary citizens scramble to encrypt conversations and cloak their online presence.


Protect your ID

Your first line of defense should be against the thieves who want to poach pieces of your identity for financial gain. More than 13 million people fell victim to identity thieves in 2013, with some $18 billion stolen, reports financial consultant Javelin Strategy & Research. ID theft has moved well beyond compromised credit cards. Javelin found that fraudsters are piggybacking on victims’ utilities accounts, running up unauthorized charges on mobile-phone accounts and infiltrating other Internet accounts, such as eBay, Amazon and PayPal. Two fast-growing offshoots of ID theft include medical ID theft, which poses risks to your health as well as your pocketbook, and tax ID theft, which occurs when someone files for your refund before you do.

The good news is that only 14% of victims in a 2012 survey by the Bureau of Justice Statistics suffered an out-of-pocket financial loss (most losses are borne by financial institutions and other companies); of those, about half lost $99 or less. Most victims surveyed spent one day or less clearing up problems associated with ID theft. One in ten spent more than a month.

Make no mistake: ID theft is a headache when it happens to you. Alex Spencer, a curator for the Smithsonian National Air and Space Museum in Washington, D.C., has been through the ID theft drill more than once. It took him months to clear up a case in the mid 1990s, when he kept getting billed for a cell-phone account he’d never set up. In 2007, Spencer closed a bank account only to find a new account in his name at the same bank, opened a short time later by someone at a branch in another state.

More recently, Spencer got a call from his credit card company saying someone in the United Kingdom was using his card. “When it happens to you, it’s pretty shocking,” says Spencer. Now, he alerts his card companies when he travels to avoid any confusion about possibly fraudulent charges, and he pays about $100 a year to LifeLock, a service that monitors his credit. “I appreciate the protection. I just wish I didn’t have to have it,” he says. (See steps to take if you're a victim.)

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