A study by Javelin Strategy & Research found that young adults are at significantly greater risk for identity theft than people in other age groups.
Social networking websites — popular among millennials — promote the sharing of personal information, thereby posing a greater risk for their users. This same group is also more likely to experience friendly fraud, in which the perpetrator knows the victim firsthand.
Younger people are also less likely to closely monitor their accounts and credit reports, meaning they detect fraud much later than their older counterparts.
I speak from personal experience. The first time it happened to me was in my late 20s when a crook withdrew money from my checking account by using personal information that was stolen from my wife's employer's payroll department.
Typically, cases of identity theft create some short-term hassle and costs, but in some situations, the consequences can be long-term and costly. Victims of identity theft can suffer trashed credit reports, reduced ability to qualify for loans and even jobs, and numerous hours of time to clean up the mess.
Follow these tips to greatly reduce your chances of falling victim to identity theft:
• Don't share your personal information over the phone. Unless you initiated the call and you well know the company or person on the other end of the line, you should never respond to requests for personal information.
• Steer clear of emails seeking personal information or action. Online scammers continue to get more creative and harder to detect all the time. To extract sensitive information from you, they can generate an email address (or even a text message) that looks like it comes from someone you know or a trusted institution. If you click on the link provided in their message and then give them the requested information, you will likely be the victim of identity theft.
• Pay attention to your monthly financial statements. Your financial institutions may alert you if they notice any unusual activity on your accounts. However, every month you should take some time to review the transactions in your credit card, checking account, and other financial accounts.
• Periodically check your credit reports. A number of people have found out about credit accounts opened in their name by reviewing their credit reports. Each of the three major credit agencies is required to provide you with a free credit report each year. So you could review one report every four months to keep tabs on your reports without having to pay.
• Freeze your credit reports. Many states allow consumers to freeze their credit information (usually for a small fee). Freezing your credit information puts you in complete control of who may gain access to your report. But, be aware that this also means you have to give permission every time someone wants to examine your report.
• Avoid placing personal information on checks. Information that you shouldn't put on your checks includes your driver's license number, Social Security number, and credit card account number.
• Safeguard your computer and other devices. Most of us have financial and personal data on our computer we wouldn't want others having access to. Use up-to-date virus protection software and a firewall. Also, don't forget to password protect your programs and files.
• Be aware of what information you're sharing with the (social media) world. Stay alert to what personal information you may be putting out there for others to see. Before sharing personal details, ask yourself if you would be comfortable with strangers knowing this particular information. If the answer is no, you may want to rethink giving it out.
• Protect your snail mail. Most young people are accustomed to doing most tasks online, so many focus on protecting only their digital information. But stealing postal mail is still a common way identity thieves get hold of your personal information. To protect your mail from theft, consider using a locked mailbox or a post-office box, or eliminate mail delivery of paper copies by having your statements sent to you via email or accessing them online.
Eric Tyson is the author of five financial books, including Personal Finance in Your 20s & 30s For Dummies.