THE GARTENHAUS REPORT, Volume 1004

IDENTITY THEFT
AND HOW TO AVOID IT

Hundreds of databases used by financial institutions, lawyers, private investigators, collection agencies, and employers store various types of personal information and detailed reports. As we have seen in the news recently, even organizations that employ sound cyber-security practices can be the subject of a breach. This information can easily be purchased by anybody and potentially be used to impersonate someone. Identity theft prevention relies on restricting access to personal data that can be used to impersonate or steal financial or health care resources.

Javelin Strategy and Research reports that an American becomes a victim of identity theft every two seconds, costing a total of $24.7 billion in 2012. That bill has most assuredly has ballooned higher since then.

Identity theft goes beyond stealing a credit card to fraudulently make charges. Here are the primary types of identity theft:

Financial identity theft: This is when a victim’s bank accounts and credit cards are accessed and used illegally. The victim’s identity may be used to originate loans, get new credit cards and open new accounts. This can affect the victim’s credit report score which can be very difficult to remedy.

Driver’s license identity theft: Criminals find ways to sell licenses to someone who looks passably similar to the real ID owner. If a criminal is ticketed for a DUI charge, the real criminal can avoid going to court and now the police are looking for the person whose ID is stolen. This can lead to having a revoked or suspended license, a warrant for arrest, or an increase in car insurance rates.

Social Security and IRS identity theft: Thieves use victim’s Social Security numbers for both financial and non-financial theft and impersonations. Tax refund fraud is the fast-growing tax crime and the IRS is struggling to control its growth. I know of two clients and a financial planner colleague who fell victim to this fraud. In a 2012 Department of Treasury report, the IRS was predicting that the IRS would lose $21 billion from tax refund fraud alone! The IRS allows for a 6-digit PIN to be assigned to prevent tax refund fraud. (www.irs.gov/Individuals/Get-An-Identity-Protection-PIN).

Medical Identity theft: Thieves use the victim’s identity to make false health insurance claims. Fraudsters can also access your personal information from health insurance companies. Blue Cross/Blue Shield and Anthem Health are two recent examples.

Internet website hacking: This is where a hacker is able to access your username and passcode data by individuals and hacking websites. Avoid being hacked by using a username and password plus a secondary level of security, such as security codes sent via text. Find out if the websites you sign into most use two-factor authentication at this website: www.twofactorauth.org.

Also, always use a Virtual Private Network (VPN) service when using public wi-fi. When you browse the web while connected to a VPN, your computer contacts the website through the encrypted VPN connection. The VPN forwards the request for you and forwards the response from the website back through the secure connection. It works like a secure tunnel through the internet. Lately, numerous VPN providers, including Banana VPN, Black Logic, LogMeIn Hamachi, and StrongVPN offer a monthly service costing about $15-20 per month. When done with your browsing session, always close out the websites you were accessing.

Child identity theft: One might think a child’s identity would be of little value. Actually, the opposite is true. A child’s Social Security number can be used to defraud the government, create false documents, commit crimes and apply for loans.

The greatest tool in preventing information from being stolen and used illegally is the security freeze. Under federal law, a security freeze requires a credit reporting agency to lock down the credit file and it can only be opened with specific permission and a PIN code assigned to the individual. This can generally be done for little or no cost for victims of identity theft.

Placing a security freeze on the more than 16 credit and information bureaus stops most ID theft cold. A freeze makes it nearly impossible to open many types of credit, banking and insurance accounts without the potential victim giving specialized access or using their PIN code to unlock the specific bureau. The three main credit reporting bureaus: Experian, Equifax and Transunion.

The proposed “remedy” that retailers and health insurance companies have recently offered to hacked customers is credit bureau monitoring that will alert you to any inquiries or attempts to open new accounts. However, these are not a long-term solution and it is not as effective as a security freeze.
You can find additional information regarding ID theft prevention at www.privacyrights.org and www.eff.org.

Source: FPAJournal.org.

5 WAYS TO A LESS STRESSFUL EXISTENCE
WITH YOUR BOOMERANG KIDS

With an estimated 85 percent of new college grads moving back home and roughly 13 percent of adult children ages 18-29 returning home after attempting to live on their own, the boomer generation is left to deal with a new set of parenting pressures, and a suddenly "un-empty" nest.

Having a 20-30 something child (or children) under your roof can be a major source of stress and anxiety in any family. A new set of delicate household dynamics can come into play. Here are a few ideas for making living with your grown-up kids less stressful.

1. Set clear goals, rules and timelines. When your child moves back home, make sure to set some preliminary guidelines and restrictions so that you’re all clear on what to expect. Do you want your child to move out at a particular age, or upon getting a stable job? Will they be contributing to household expenses? Will they be responsible for their own laundry or different household chores? Setting clear parameters at the outset of a new living situation will help prevent your child from overstepping boundaries or overstaying their welcome.

2. Respect your kids’ choices and independence. Even if you disagree with some of your child’s choices in their career or personal life, if you are going to coexist peacefully, it’s in your best interest to allow adult kids to live their own independent lives without judgment.

3. Set financial boundaries. Once you’ve made some agreements on your child’s responsibilities, be sure to enforce them, particularly when it comes to finances. Living at home while launching a career can be a helpful step for young people in building a solid financial future, but it won’t do them much good if they squander their money while taking advantage of their temporarily cheaper living situation. Encourage them to save, pay off student loans and establish a retirement account.

4. Embrace new roles and avoid slipping into old patterns. With your kids back home just like before they went to college, falling back into old roles and patterns can feel natural. But things aren’t the same. Your role as a parent and their role as a child has evolved. Develop a new system of interactions, rules and shared responsibilities that reflects both of your greater independence. And try to refrain from deluging your child for tech help constantly!!!

5. Avoid placing blame on yourself or your kids. The economic situation hit many young people hard and this generation faces greater challenges in launching careers and paying off their college debt than any previous generation. Although it’s easy to blame your children and think of what you might have done differently as a parent, placing blame will only increase stress levels.

It is important to respect the necessary transition you are all going through—taking the steps described will help your kids spread their wings so that they can eventually fly and thrive.

Source: Huffingtonpost.com

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The opinions and forecasts expressed in this commentary are those of the author and may not necessarily reflect those held by NFP Advisor Services, LLC. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a guarantee of future results. It is not guaranteed by NFP Advisor Services, LLC for accuracy does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. The indices mentioned are unmanaged and cannot be directly invested into. Past performance is no guarantee of future results. NFP Advisor Services, LLC does not offer tax or legal advice. Securities and Investment Advisory Services offered through NFP Advisor Services, LLC, member FINRA/SIPC.  NFP Advisor Services, LLC is not affiliated with Gartenhaus Financial.