According to a recent report by Smartcredit.com, only 4% of people access their free credit each year. The government originally started requiring the three major credit bureaus—Equifax, Transunion, and Experian—to provide a free annual report every year to encourage credit education, reduce fraud and identity theft among consumers. Given the 4% utilization rate, it appears the effort may not be working according to plan. However, credit monitoring is big business as more and more players are entering the market for your financial management dollars. Here are five things to consider regarding personal credit management and your free report:
1. Annualcreditreport.com is the ONLY government sponsored site that offers a free annual report from each of the three credit bureaus. There are countless copycats and plenty of other legitimate providers, but make sure you know what kind of site you’re visiting before you invest money with a credit monitoring service.
2. This site (annualcreditreport.com) allows users to choose the method and timing of report orders. The reports can be ordered at the same time or staggered over the course of the year: user option. Also, the credit history report is free, BUT it does cost to get a FICO score as part of the order.
3. Once you order a report from one of the bureaus, it’s not free again for a full year.
4. Since the report is designed to promote awareness, it makes sense to use the report to familiarize yourself with the content of your report. If there are errors or fraudulent information on your history, there are ways to dispute the information and get the report corrected. It’s important to dispute the information immediately so when good credit matters—loan, insurance, and job application to name a few—your record will be correct and accurately reflect your history.
5. As identity theft and security breaches of personal information become more common, it is essential to protect identity and monitor fraudulent activity. All three of the main bureaus, and many other quality credit monitoring providers, offer ongoing protection in various forms. It would be very wise to use annualcreditreport.com as an introduction to your credit, and then find a service to help you monitor your credit and personal information moving forward. It is much easier to plan ahead and purchase protection than it is to try to pick up the pieces after you’ve been victimized by identity theft.
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