In 2018, 14.4 million Americans fell victim to identity theft crimes, totaling $1.7 billion in out-of-pocket costs. While most states and credit card companies limit the amount you have to pay when someone steals your identity, your overall cost depends on when you catch the thief and what it will take to correct it. 

For some people, identity theft can be crippling to their financial future.

While credit card theft remained the number one most popular type of identity theft, there are still other types of identity theft that consumers need to be aware of. 

Financial Identity TheftStealing someone’s financial profile in order to open new lines of credit or purchase things under their name. 
Child Identity TheftChildren’s Social Security numbers are extremely valuable because they are a blank slate. Some identity thieves steal these in order to create driver’s licenses, buy a house, and more.
Medical Identity TheftAccessing someone’s medical information in order to obtain medical care, medication, insurance claims, and more.
Tax Identity TheftSomeone can use your SS or Employer Identification Number to steal your tax refund. 

If you’re worried about identity theft or experiencing it currently, you’re not alone. In Part 1 of our Stolen Identity series, Dr. Thia explained her experience with identity theft and how it impacted her and her husband. 

Using her experience as a starting point, she has compiled this information about identity theft from reputable sources to help give you a little peace of mind when it comes to identity theft and what you can do about it. 

How does identity theft happen?

Identity theft can happen in a multitude of ways. Ultimately, the one thing they have in common is that someone steals personal information in order to gain access to information, finances, or both. 

Here are the main types of ways that identity theft can happen:

Data breach

Every time you enter your information, whether it’s online or in-person at a facility, your data is stored somewhere. Most of the time, that somewhere is in the cloud. Advanced hackers have now figured out ways to break into protected clouds in order to steal consumer’s information. 

Unfortunately, this type of identity theft is hard to prevent from a consumer level. Most protection has to happen at the top from the company itself.

Credit card or mail theft

Thieves can steal your information either by swiping your mail from your mailbox or by gaining access to your credit card number through a website or by even stealing it off of your person. 

This is why most experts suggest that you shred all personal mail or break credit cards in multiple pieces before throwing them away. 


Phishing is a form of spam where thieves try to steal your information from you by gaining your trust. They do this usually by pretending to be someone else, like the IRS or Social Security Administration. Sometimes, they even pose as someone you know, like a grandchild, in order to try and get you to send them information, money, or both. 

Unsecure browsing

Using public wifi or unsecured browsers can be like leaving your front door wide open with a sign that says “Come steal my precious antiques!”

Some browsers may alert you to unsecured websites (or will not have the little padlock imagery on the search bar), while others may not. By sticking to reputable sites, you should be OK with this. But just be aware. 

As for public wifi, that’s still a hotly contested debate. Sometimes, using public wifi is unavoidable. In these situations, we recommend sticking to absolutely crucial work and avoiding things like personal shopping or checking your bank account balance. “Eavesdroppers” can drop in on your computer through public wifi and steal your information as you type it.

Identity theft prevention techniques

The best identity theft protection is to be smart. Double- and triple-check that you’re giving your information to a trusted source, whether it’s an online source or a phone representative. Unfortunately, identity theft can happen to anyone, and identity thieves are getting smarter every time they’re caught. 

While you can’t fully safeguard yourself against identity theft, there are a few things you can do to help protect yourself against it: 

  • Never give out your personal information over the phone. Government agencies will rarely ever call you asking for information. If the “IRS” or “Social Security Administration” calls you asking for information, it is very, very likely that it is a scam. Here’s information from the IRS that tells you how to know if it’s them contacting you or a scammer.
  • Check your credit score often. As mentioned in Part 1 of this series, Dr. Thia didn’t know that her identity had been stolen until she had my credit checked to take out a loan. Checking your credit often can help you see if any new accounts have been opened in your name without you knowing.
  • Set up alerts on financial accounts. Today, many banks and financial institutions allow you to set up alerts that notify you in real-time when purchases are made. This can help you make sure no one is accessing your finances without your approval.
  • Don’t carry personal information with you. Outside of your driver’s license, there is no reason you should carry any other personal information with you like your Social Security card. Leave it at home under lock and key and give it out only when extremely necessary (and after asking why someone needs it). 
Man and woman hugging outside

What do I do if identity theft happens to me?

As mentioned above, even by taking all of these steps, identity theft may still happen to you. Luckily, there are many actions you can take to correct identity theft. 

The first thing you should do according to us (and even the FTC): Take a deep breath. Then, get to reporting your identity theft and settling any inaccurate information. 

Report identity theft

The Federal Trade Commission lets victims create an FTC Identity Theft Report to help prove that someone stole your identity. This is the first step in assuring that you can redeem your identity back and recoup some, if not all, of the losses associated with the theft. 

After you set up your report, you can place a one-year fraud alert on your credit report, which tells creditors that they must double-check the identity of whoever is applying for credit with your name. You can also do this for seven years if you prefer. 

Dispute inaccurate information

You’ll need to work with the reporting bureaus to dispute any fraudulent or inaccurate information on your credit report. To do this, you will simply write to the credit bureau and they must legally investigate your claim. If they find that the information is wrong, they will take it off your report for you. 

You can also hire a credit repair company to do this if you really want to, but just know that everything a credit repair company does, you can do yourself. They do not have any sort of access to tools or information that you as a consumer do not. 

Note: If debt collectors are reaching out to you for these fraudulent and inaccurate accounts, you can show them a copy of your FTC Identity Theft Report and they’re barred from reporting on these accounts or even trying to collect from you.

Don’t forget to check on your mental health

While most people worry about the financial impact of identity theft, we understand that there’s more than that. A study by Experian looked at the biggest issues caused by identity theft. And while time and money were the number one and two factors, emotional distress came in a close third. 

In the study, 66% of respondents said that they experienced fear surrounding the security of their personal finances and 53% said they felt hopeless or powerless after their identity theft. These are powerful emotions that can impact your life far beyond just correcting identity theft.

If identity theft happens to you, we hope you remember to think about your emotional and mental health just as much as you prioritize getting your finances back on track. 

If you need emotional or financial support during this time, we also offer personalized and confidential coaching services. In these 60-minute sessions, we can help you feel more secure in your financial future through actionable and customized feedback.