Best Credit Monitoring Services Based on In-Depth Reviews

Credit Monitoring? Please Explain

Credit counseling, credit repair, credit insurance, credit monitoring… There is no shortage of services related to credit. For this reason, many similar-sounding and overlapping products in the industry may confuse the average consumer.

So, credit monitoring — here we go.

Essentially, credit monitoring is a service that keeps an eye on your credit score and alerts you to actions that may be considered suspicious. At its core, the service doesn’t provide protection against having your personal information stolen and misused, but it does warn you about such unfortunate events. Certain patterns, indicators, and unusual transactions may be signs of fraud and the sooner you’re aware of them, the better your chances of rectifying the situation. If someone commits fraud using one of your credit cards or takes out a loan using your Social Security number, it may have a negative impact on your credit score.

Whereas credit repair strives to improve your score and remove negative items from your report, credit monitoring is designed to save you trouble by surveilling your finances. Something unusual pops up and you’ll find out. How fast? Well, that all depends on your plan. Upon realizing that you’ve been a victim of fraud or theft, the first immediate step to take is to contact one of the credit reporting agencies and placing a fraud alert with them to minimize the potential damage.

Now, we all make mistakes. Remember Shaquille O’Neal’s 1993 rap album? But you don’t want to make mistakes when it comes to your sensitive personal information. Knowing when and where to disclose this information is of utmost importance. The second someone else appropriates your information, you may become a victim of credit fraud or identity theft.

Data: FTC Consumer Sentinel Network Data Book 2018

Who Needs Credit Monitoring?

Credit monitoring packages provide a wide range of attractive-sounding benefits--but do you really need them? Most of the advertising for the credit monitoring industry tries to appeal to your fears, pointing out everyone and their dog is liable to have their identity stolen and their finances thrown into disarray. Read some of these sites and you’ll find they want to scare you into employing their services. We’re going to look beyond the landing pages and dive in a little deeper.

Truth be told, credit monitoring isn’t for everyone. Nevertheless, it is a practical service created to save you time, place invaluable resources within your reach, and expose you to information you probably wouldn’t have otherwise.

Yes, credit monitoring is usually sought out by consumers who have been victims of identity theft and are hoping to avoid another incident. However, consumers can also reap the benefits of having an extra pair of eyes on their finances. In the last two decades or so, people’s credit histories have become more important than ever. Nowadays they are used not just by credit card companies and mortgage bankers to determine whether to give you a loan--they are used by potential employers, prospective landlords, and even would-be romantic partners. Without credit monitoring, you will have no real-time way of knowing what those prospective creditors are seeing--and you may never know why you’re being ghosted after two dates. 

Other people pay close attention to their credit histories and credit scores because they’re trying hard to rebuild their credit ratings. Take it from us, that can be a slow and laborious process. Monitoring your credit history and credit scores can show you what progress you’re making and help teach you what kind of behaviors increase and decrease your creditworthiness. 

As Bruce McClary, Vice President of Communications at the National Foundation for Credit Counseling, puts it:

“Peace of mind is important. I mean, obviously, you don’t want to be worried about what could possibly happen that you’re not aware of. So if you need peace of mind, information is often the best way to find relief, and access to that information on a regular basis can help ease your concerns because you are able to see what’s happening on your credit file. So, for that reason, I think just in terms of stress relief it is important to keep your eye on your credit and account activity as much as possible.”

Bruce McClary, VP of Communications at the National Foundation for Credit Counseling

How to Sign Up

With your Social Security number at hand, you can sign up for credit monitoring in a matter of minutes. Please, exercise caution! Handing over those precious digits to any website may expose you to bad actors. We live in an age that’s oversaturated with data, so try hard to only give your Social Security number to reputable websites.

What Makes a Good Provider?

A great credit monitoring provider, whether it’s free or a paid service, will provide you with regular access to your credit report and scores. If they have a good system in place, they’ll be able to alert you fairly quickly about any suspicious activity they’ve detected. Anything from a sudden postal address change to a loan application could be considered suspicious. Alerts can range from a text message or an app notification to an email or even a phone call.

Credit monitoring services keep an eye on one or more of the three credit bureaus. Other benefits may include identity theft protection and dark web scanning. Since the dark web is the digital landscape where most stolen identities are sold, having a provider search for your information on criminal websites is helpful.

In all likelihood, there isn’t one company that will fulfill all your needs but perhaps they’ll come close. One of them could give you frequent access to your credit report, but their customer service is as warm as Chicago in January. Or another may provide all sorts of perks, but only look at one of three bureaus. Perfection in finance is as rare as correctly inserting a USB drive on your first attempt. 

We asked Bruce McClary what separates a good provider from a bad one:

Good News for Active Duty Military Personnel

Effective July 31^st, 2019, active duty military consumers are eligible for free credit monitoring provided by nationwide consumer reporting agencies. The new law provides that “credit reporting agencies--Equifax, Experian, and TransUnion--must provide free electronic credit monitoring services to active duty servicemembers serving away from their usual duty station and to National Guard members.”

What Does Credit Monitoring Tell You?

Data Breaches

Most good credit monitoring companies will alert you to data breaches that may have compromised your personal information. Data breaches are unauthorized releases of confidential and sensitive consumer information and represent the biggest hacking events of the 21st century. 

In 2017 alone, there were 1,579 data breaches exposing nearly 179 million records. That represents a 44% increase in the number of breaches and a 389% increase in records exposed. To put it into perspective, data breaches are happening on a nearly daily basis. Some of these breaches have exposed up to three billion consumers’ personal information--in just one incident. As R.L. Walters pointed out, “So many companies save all kinds of information on their customers, but they don’t have the expertise to make sure that hackers don’t get in to steal it. Everything is digital. We’re all paying with credit cards, [using] very little cash. That, by its very nature, requires you to give up some information.”

In other words, since data breaches are happening more frequently and large retailers are having their databases hacked, you ought to be careful about how you handle your sensitive information online. That includes not saving your credit card on retailer websites, even those you trust. The alternative is to manually enter your information for each purchase. Yes, it’s a hassle but that extra effort just might benefit you in the long run. Like taking the stairs instead of the escalator, but without the sore calves.

“That’s the biggest problem with data breaches,” Grant points out, “consumers are at the mercy of the entities to which they trust their personal information.”

Susan Grant, Director of Consumer Protection and Privacy at the Consumer Federation of America

After a major data breach, it’s never entirely clear if your information has fallen into the wrong hands. That’s where credit monitoring comes in. You may not be able to prevent your personal identifying information from being breached, but with the help of credit monitoring, you can begin to take steps in a timely manner to mitigate any potential damage. Read on and find out immediate steps you can take upon being alerted of fraud or theft.

Credit Card Fraud

When it comes to stealing credit card information, methods have changed since the days of carbon copiers. From skimming devices copying your card’s magstripe, to shimmers reading data from the card’s chip, getting ahold of private credit card information has become more sophisticated.

We spoke to Rob Rex, a consumer who had his credit card information stolen. “I know [it happened at a restaurant] because I’d just gotten this card. It was a Saturday. On Tuesday I see a cable bill on my account and an attempt to connect to two PayPal accounts. [This was] before they started bringing the credit card machines to the table. The credit card was out of my sight for two to three minutes, but that was enough.”

Rob Rex had his credit card information stolen

Indeed, restaurants have come under greater scrutiny recently for their role in credit card fraud. At most restaurants, people who want to pay with a credit card give their card to their server, who then takes it to the cashier and returns with the card and a charge slip. During the time the card is out of the cardholder’s sight, account numbers can be copied and electronic information can be downloaded. One victim described how one such instance prompted him to change the way he handles his finances: “After the incident, I wasn’t going to let that happen again. From then on, I always carry cash and avoid using my card when I can.”

Online, credit cards are at greater risk of being compromised. Even with trusted retailers, your information is not entirely safe, according to Bruce McClary: “That credit information has to sit on a server. That means that you put [it] in someone else’s hands to safeguard, but you know very little about the firewall that they have to protect that data. So it’s a giant leap of faith on the part of the consumer.”

Social Security Number Identity Theft

Social Security theft can be the result of a data breach, a misplaced or thrown out paper, or just honest mistakes over the phone speaking with a scammer. Even if your number is compromised, that doesn’t mean there will be immediate action. Cybercriminals sometimes choose to wait before they use a number for any kind of criminal behavior, when the potential victim may be less attentive. A dark web scan will let you know if your number has been put up for sale in online criminal marketplaces.

What can a person do if they have your Social Security number? A lot of things, including setting up a bank account, taking out a loan, filing fraudulent tax returns, among others. A criminal can essentially become you, in a sense, once they have the number in their possession. 

Susan Grant told us about her own experience with an attempt to steal her Social Security number: “I’m repeatedly getting calls from someone claiming to be from the Social Security Administration, wanting to confirm my number--which is like the key to your lockbox. People need to be on guard against those kinds of attempts.”

Online Shopping Scams

Online shopping scams usually take the form of fake websites that are replicas of trusted vendors. You may be redirected to these sites after clicking on bogus links in emails or on social media. One giveaway is the http in its address, as opposed to https. Sites that lack that ‘s’ don’t use encryption, therefore they are not to be trusted.

The most frequent items involved in shopping scams are clothes, especially during the holiday season. Be cautious of offers that are just too good to be true. Other red flags are questionable payment options such as money orders or wire transfers. We’d recommend using a credit card or PayPal, seeing as both offer purchase protection for buyers.

What to Do If You’re a Victim of Credit Fraud or Identity Theft

Proceed with a clear head and take action immediately. First thing is to get in touch with the companies and/or banks where the fraud took place. Give them all the details concerning your incident. Then contact at least one of the major credit reporting agencies and place a fraud alert. They’re required to inform the other two, so don’t worry about that.

After that, request copies of your reports on Annual Credit Report. Then, if it applies to your particular situation, report your ID theft to the Federal Trade Commission and contact the Social Security Administration and report any unauthorized use of your number.

More detailed information is available at IdentityTheft.gov, the federal government’s resource for identity theft victims.

Other Threats

Targeted Groups

Our research has shown that two segments of the population tend to be targeted above all others: The elderly and active-duty members of the military. And yet, identity theft tends to be a random crime, meaning anyone can be affected.

Where the elderly are concerned, it’s understandable to a certain extent because some of these folks have paid off their debts, allowing them more liquidity than their younger counterparts. This availability of resources makes them an easy target for bad actors bent on cheating people out of their money. Also, some older people may not be as technologically savvy as younger folks, making them unaware of the latest methods of fraud and theft. Most of these scams are done over the phone.

On the other hand, military personnel regularly have to disclose their Social Security numbers for basic serviceperson errands, from identifying themselves over the phone, to filling out insurance claims. They face particular challenges where their finances are concerned, especially considering that most security clearance background checks look into credit. Scam alerts provided by the military are updated regularly to safeguard active personnel from faceless cheaters.

We asked experts about these recurring attacks on both the elderly and the military. Here’s what they had to say:

Susan Grant: “Service members are more vulnerable because they move around a lot and may be deployed overseas. It may take them longer to discover their identity has been stolen and do something about it, and that enables identity thieves to use their information for longer. Similarly, older people who are targets of a lot of scams may be more likely to give their personal information.”

Bruce McClary: “I think, whether it’s someone who’s elderly or an active-duty servicemember, or whether it’s a young consumer who’s opening up credit for the first time and is beginning to use that in different environments including online--I think in all those situations vigilance is key for protection.”

Tips to Minimize Risk of Identity Theft

There are no guarantees when it comes to identity theft. As Susan Grant pointed out, “Nobody can claim [that you won’t be a victim]. If you hear that, you should report the company to the FTC because it’s not true. Most identity theft services, the main feature is to alert you--after the fact--that your information may have been compromised and help you take whatever steps would be appropriate to minimize the potential fallout.”

Consumers can take the following steps to reduce their exposure:

• Be discreet when saying your Social Security number in public
• Ask if a third party really needs the information they’re requesting
• Avoid clicking on strange links in emails or websites
• Don’t confirm any identity information over the phone
• Hang up on callers that cannot be verified
• Use strong passwords
• Don’t use the same password for all your accounts
• Check your bank and credit accounts regularly
• Don’t access sensitive information when using public Wi-Fi connections
• Limit the amount of personal information shared via social media
• Try to avoid paying bills through the mail, but if you must, don’t leave them in a mailbox outside your home

One can never be too careful when limiting who and what has access to your personal information. “I would say that an ounce of prevention is worth a pound of cure,” McClary told us, “So anything that you can do to safeguard your personal information, do it. Whether it’s being aware of your surroundings when you’re using your credit card or pin number or being careful of the websites where you’re making online purchases.”

Furthermore, social media has become a big liability for some consumers who post information that can be used against them in an effort to commit fraud. A social media platform like Twitter has nearly 70 million active monthly users in the United States, all sharing information, photos, and locations. In essence, there’s plenty of over sharing.

As R.L. Walters points out, “Consumers tend to put too much information out there. People put so much on their social media that makes it really easy on a criminal to have [what] they’d need to steal your identity or come up with a different identity that uses your information.”

Credit Monitoring vs. Identity Theft Protection

So, What’s the Difference?

Credit monitoring is a beneficial service, but with certain limitations. It will alert you if suspicious activity shows up on your credit reports, but it will neither prevent your personal information from being stolen nor help clean up the damage caused by identity thieves. By contrast, identity theft protection is designed to prevent malicious acts from even happening. For instance, your Social Security number can be used by a third party in ways that will not show up on your credit reports; an identity theft protection service would pick up on that sort of activity.

There isn’t always a bright line between a “credit monitoring company” and an “identity theft protection company.” For example, some credit monitoring companies offer identity restoration in the event of theft. Others even reimburse consumers for any financial losses they may have incurred as a result.

For more information, check out our Best Identity Theft Protection Based on In-Depth Reviews.

The One You Need

Telling you which of these two services is better for you is a hard one. Since free credit monitoring services are widely available, it wouldn’t hurt to try one of them out, assuming they appear to be trustworthy entities. You can relax a bit knowing that someone is keeping an eye on any applications for credit done in your name, payment history, among others. And if you decide you like the information that free services provide, you might then consider signing up for a paid plan that offers additional benefits.

Identity theft protection may be a wise choice for someone who’s already been a victim and would like to avoid a repeat performance. Consumers in this situation may also opt to freeze their credit, restricting access to their report and hindering any theft attempt. Susan Grant told us that credit freezes are “probably the most effective thing you can do as a prophylactic. It will foil attempts to open most kinds of new accounts in your name. Not all of them, because not all creditors check credit reports.”

The Do-It-Yourself Approach

Another alternative is DIY. Taking matters into your own hands may be difficult, but not impossible. It’s like washing a car. Sure, the pros are going to do an outstanding job, but your own effort won’t be in vain.

The first chore you’ll want to tackle is keeping a close eye on your credit statements as often as possible and look for any signs of suspicious activity. See something you don’t recognize? Get on the phone with your bank or credit card provider and demand answers. 

Second, use annualcreditreport.com and pull your credit report from each of the three major credit reporting agencies once every 12 months. That’s a no-cost service that gives you full access to the details on your credit report. Some consumers even request one report from each bureau every four months in order to have year-round monitoring. If you decide to spread out the reports, you wouldn’t be the first, but it’s a fact that some items will only appear on one or two of the reports, as opposed to all three. Some banks, insurance companies, and even employers offer free credit monitoring services. So look into it--perhaps you already have a service and are not aware of it. 

When going for the do-it-yourself approach, it can be difficult to keep track of everything. Just keep in mind that some plans offer free trials, while others offer credit monitoring services free of charge.

What to Expect Going Forward with a Credit Monitoring Service

Things to Consider Beforehand

A credit monitoring service is simply a tool that consumers can use where they have someone else keeping an eye on their credit activity. These services will typically watch the activity on each of the three major credit reporting agencies to make sure you know what’s being added to your credit file. You receive alerts to make sure you’re aware in the moment of any account activity that may be taking place. 

As the customer, you have the option to set up different alert systems that may provide you with warnings of suspicious activity. This will allow you to take action quickly if there’s something that needs to be addressed right away.

So consider all your financial needs. Keep them in mind to avoid paying for services you may not need. Read the fine print, know the cancellation policy, and put in the time to research a company and make sure they’re trustworthy. Ultimately, what will determine the kind of credit monitoring service you want is how extensive you want/need it to be and how much you’re willing to pay for it.

Oh, the Costs. Are They Worth It? Is Free Monitoring Enough?

That depends on your budget, of course. Also, personal preference and comfort level come into play when considering the amount of access to information, the frequency of the alerts, among others. Some consumers may feel more comfortable with a paid service that offers more features that will tend to their specific needs. Access to information from all three credit bureaus is something else to consider. 

Some free services only extend their monitoring to one bureau. But, it’s free! You will save anywhere between $100 and $200 a year, while still receiving a service from a (hopefully) reputable company. 

We asked Walters about paid monitoring services: “I think the ones that have a cost have a few more protections built in,” he said. “A little more bells and whistles. Some do a good job at an affordable monthly cost. I think, based on what I’ve seen, it’s plausibly worth it.”

Susan Grant is skeptical about free services, indicating that nothing is really for free:

Is Credit Monitoring an Essential Service?

The short answer is maybe. Long answer… Keep in mind that credit monitoring is not a preventive service. Yes, you will be alerted of suspicious activity. But that’s after the fact. The service can be helpful in alerting you more quickly than you might otherwise find out about somebody opening a new account in your name. And yet, it will not alert you to all different kinds of identity theft that may have been committed with your personal information.

With plans ranging from basic to premium, there are plenty of options out there. But for broad protection, you need a service that uses all three credit bureaus. Insist on this, in particular, if you’re paying for the service.

In the end, even if you do employ the services of a credit monitoring service, you would be wise to keep an eye on your credit yourself and take measures to secure your personal identifying information. While credit monitoring can provide certain benefits, including peace of mind, having a service should not result in you lowering your guard. Again, there are no guarantees.