- The elevated estate, gift, and generation skipping transfer tax exemption limits allow you to transfer more assets to your beneficiaries tax free
- These limits are set to sunset at the end of 2025 but legislation could be passed to change them even sooner
- Advanced planning techniques beyond the annual gift exclusion and direct gifts exists for clients to take advantage
Today’s consumer almost certainly has some financial information online. Even if you don’t shop online or use your phone to check your bank balance, there is personal identifying information (PII) and financial information online for almost every U.S. citizen.
To make sure you’re keeping all of your information safe to prevent identity theft or financial fraud, you should take some precautions. HCR Wealth Advisors has some sensible tips to help you avoid being taken advantage of.
Are you using best practices for loss prevention when it comes to your bank accounts? These tips can help you cover all of your bases.
Your personally identifying information and your financials are tightly woven together, so someone with access to even basic information about you may be able to access your hard-earned cash and siphon it away, or worse, commit financial fraud in your name.
All of your bank accounts, including online savings accounts, should be FDIC-insured. The government insures these for up to $250,000 per owner. If you have savings accounts that you don’t use for withdrawals, notify the bank not to approve withdrawals, only deposits. If you use online banking, enable two-step authentication so that if your device is compromised there will be additional steps to access your funds. A separate department that operates 24 hours a day, 365 days a year often manages debit cards with a different number than your bank. Be sure to have that number handy in case you have to report a theft.
Many credit cards come with additional protection in case of fraud, and the government has set limits (typically $50) on how much you can lose to unauthorized charges. Contact your card company immediately if you suspect a scam. If you frequently shop online, consider having a dedicated credit (not debit) card with a hard limit you use exclusively for that purpose. Don’t let online websites “save” your credit card number; you’re better off entering it each time rather than having your data stored in their system.
Mobile Device Tips
Your mobile devices can make you uniquely vulnerable to financial fraud and identity theft. Make sure your phone is passcode protected, enable “find my phone” options, and ask your carrier if there is a way to “remote wipe” a device that is lost or stolen.
Financial Mobile Apps
Always investigate new app security protocols when downloading a new application. Any app that is connected to your financials or needs a credit card for in-app purchases should have clear, transparent, and comprehensive security systems in place that you can easily access. It’s better to skip a download than to put your PII or financial passwords on an unsecured app.
In addition to following the advice above, consider waiting until you get home to make a purchase rather than buying it while on the road. Unsecured WiFi hotspots in coffee shops or airports can provide connectivity; they can also be vulnerable to hacking. Using an unsecured hotspot could result in all of the personal and financial information on your phone becoming compromised.
Online Activity Tips
Your activity on the web, in email accounts, and online ads can put you at financial risk and open the door to identity theft.
Be Wary of Pop-Ups
Poorly designed websites requiring a lot of clicking around to find what you are looking for, those that don’t seem to respond when you click on something, or that have multiple pop-up windows may not be legitimate websites.
Don’t enter personal information or payment information in a pop-up unless the site is well known and trusted. When making payments, consider using PayPal or a similar payment portal instead of entering your credit card number directly. This gives you added fraud protection (and possibly purchase protection).
Watch Out for Scam Emails
If you get an unsolicited email from an unfamiliar financial institution warning you that your account has been compromised and asking you to call a number or enter PII on a website, call the regular number for your bank to report it. Your bank should never ask you to go to a website and enter your account number online, or your password. Likewise, be suspicious of hyperlinks in unsolicited emails. Always call your financial institution instead of clicking on a link.
Social Media Tips
Social media is the new hunting ground for hackers, scammers, con artists, and fraudsters. Protect yourself by being careful about how you conduct yourself on social media platforms.
Avoid Online Games That Ask for PII
Those harmless social media quizzes that ask you to choose your birth month, first name, and last name to build a funny moniker are actually trying to get information that can be used to create a profile of you. The next game might ask you to type your name but replace certain letters with others. A third could ask you for the first type of car you owned, or the street address you lived on when you were twelve, or your best friend’s name in high school. These types of questions are often used as security on websites if you lose your password and need a reset.
Don’t Friend Strangers
Don’t accept Facebook friend requests from strangers, as a rule. If you do accept, see if the platform you are on allows you to relegate them to a group of acquaintances that won’t see everything you post. Online fraudsters often target people on social media, then use their hacked accounts to trick others into clicking links that allow malicious software to be downloaded onto your device. The malware can trigger a hidden program that explores your device, looking for passwords, and account information.
Any financial activity you engage in will have a record, on paper and/or online. Staying on top of these records and verifying them regularly can help you spot inconsistencies and halt any fraud or financial losses.
You should review your credit card and bank statements at least once a month. If you make a lot of transactions and use online banking, you will benefit from reviewing transactional activity even more frequently. Do the same for any investment and savings accounts, even if you don’t have much activity.
Shredding paper documents should be a habit, and then consider using the shredded paper as cage material for a bird or hamster if you have one or mixing them into your compost heap. Alternately, you can dump coffee grounds and dregs over them in the trash before tying the bag off. Dumpster diving or curbside trash theft is still a way that scammers can obtain high-value information.
Are you thinking about security when you use your devices, from your home P.C. or laptop to your tablet or smartphone?
Use Strong Passwords
Passwords are the downfall of many. Ideally, you have a completely different, randomly generated password for each account online. Realistically, you probably don’t. At the very least, make sure your passwords for your financial accounts are entirely different from those you use for email and have a third set you use for online websites. That way, if a website you frequent gets hacked or your email is compromised, the hacker will be unable to access your bank accounts. Consider passphrases rather than passwords, something that means something only to you, and no-one else will be harder to hack.
Maintain Device Security
Make sure you check for computer security updates regularly. Doing so helps to guarantee that you have the most recent upgrades, including security patches. Your security software should be set to update automatically. You’ll need a personal firewall as well as anti-virus, anti-spam, and spyware detection features, and encryption software for laptops. Your mobile phone should also be equipped with security.
Don’t stay logged in to websites and avoid “saving” your password. If someone accesses your computer or phone, the last thing you want them to be able to do is to open your banking page from your bookmarks and have your username and password already filled out for them to click “log in.”
Home Safety Tips
Paper isn’t necessarily safer than digital. Your physical home and mailbox can be just as vulnerable and lead to information being accessed and then used for identity theft or online financial fraud.
Buy a Home Safe
A safe is the best place to store items like your original social security card, birth certificate, bank and brokerage statements, insurance paperwork, and so on. If not properly secured, a physical break-in could result in the loss of these important documents, which could swiftly be used to set up fake online identities in your name. This can quickly lead to financial ruin.
Minimize Financial Mail
Ordering checks? Pick them up from the bank. Expected a check? A P.O. box can be safer than having it arrive in your easy-to-access home mailbox. If you absolutely must receive paper copies of bills and bank statements, have them sent to the P.O. box, too. Consider checking accounts and paying bills from the comfort of your home on a secure network to make transactions instant and traceable.
ID Security Tips
Your identity is the easiest path to your money. By safeguarding your PII, and routinely checking for signs that someone might be posing as you, you can cut down on your risks.
Do Periodic Identity Theft Checks
Review your annual free credit report from the three main credit bureaus every year and look for any inaccuracies or unauthorized activity. Report inaccuracies immediately to prevent a lowering of your credit score.
Freeze or Lock Your Credit Profiles
You can ask for your credit report to be locked or frozen if you suspect fraud but be aware that if you apply for credit or a loan, no-one will be able to run a credit report while the hold is in place.
By following these tips from HCR Wealth Advisors, you can help protect your identity and your financial security.
About HCR Wealth Advisors
HCR Wealth Advisors consists of an expert team of registered investment advisors, assisting generations of investors since 1989. The independent firm is guided by strong ethical principles and governed by a fiduciary responsibility to act in each investor’s best interest. HCR Wealth Advisor’s fee is based on the number of client assets under management rather than commission-based for the highest possible transparency.
* This article is for information purposes only and should not be considered investment or legal advice. If you have specific investment or legal questions, please consult your financial advisor and/or lawyer.