How to Protect Your Identity This Holiday Season

More and more Americans are skipping the crowded shopping malls, long lines and full parking lots and doing their holiday shopping from home.

During the 2019 holiday season, online and non-store retail sales are expected to grow between 11% and 14% compared with 2018, according to the National Retail Federation.

But online shopping comes with risks, including thieves looking to steal identities and commit fraud. Cybercrime is also getting more sophisticated. Malware, or malicious software, for instance, is getting harder to detect, according to Trustwave's 2019 Global Security Report. And e-commerce websites are some of the most vulnerable targets for security threats.

While shopping online, use these safety tips to protect your money and your identity.

1. Only Shop at Secure Websites

Before making an online purchase, make sure the retailer's website is secure—otherwise, criminals can more easily get access to your personal data. Security risks are especially high during the holiday season. In 2017, for instance, cyberattacks jumped around Black Friday and Cyber Monday and stayed high into January, including during post-holiday sales, according to research by cybersecurity software provider Carbon Black.

To find out whether a site is secure, check to see if the URL starts with "https://" instead of "http://"; the latter indicates an unsecured connection. You can also look for a small padlock icon in the address bar. Your web browser may even point out that the site you're using isn't secure. If that's the case, shop elsewhere.

2. Use Credit Cards, Not Debit Cards, to Shop Online

Credit cards offer strong protection from fraudulent charges. Many credit card issuers provide zero liability protection, meaning you're not held responsible for fraudulent charges. Even if your card doesn't include this feature, federal law limits your liability for covering unauthorized charges to $50.

If someone makes a charge you didn't authorize on your debit card, however, the amount you have to pay depends on how quickly you report it. Plus, that money is immediately taken from your bank account, and it could take a lot of time and effort to get it reimbursed.

Your best bet is to shop with a credit card, but make sure to pay off those charges by the end of the month, if possible, to avoid carrying a balance.

3. Don't Shop on a Public Wi-Fi Network

Do your online shopping at home on a secure Wi-Fi network. It may be tempting to take your laptop to a coffee shop, but making sensitive transactions on a public Wi-Fi network puts you at risk. Thieves can more easily intercept any data, including credit card numbers and passwords, on a public network.

You can set up a virtual private network, or VPN, on your laptop or phone, which encrypts your connection while you're on a public network. That makes it less likely your data will be compromised. Dependable VPNs generally require a monthly fee and subscription to a yearlong or multiyear plan.

Also, avoid using a public computer in case spyware or malware have already compromised the device.

4. Take Advantage of Credit Card Security Features

The risk of a thief stealing your information while shopping is just one security issue during the holiday season. Credit card account information is also one of the most commonly compromised types of data in security breaches, according to the Identity Theft Resource Center.

That makes it especially important to pay close attention to your credit card and how it's being used. These credit card features can help:

  • Virtual card numbers: Some banks and card issuers offer their customers virtual credit card numbers, which are temporary numbers that can be used while shopping online. If there's a data breach at a retailer where you shop, your real account will be protected. Plus, if a merchant only has your disposable card number, it's more difficult for potential fraudsters to access your credit card and make unauthorized purchases.
  • Account alerts: Sign up to get text or email alerts if your credit card is used to make a purchase over a certain amount, or if your issuer notices unusual activity.
  • Account lock: Your credit card may give you the option to lock or freeze the account if your card gets lost or stolen. This can buy you time while you search for the card if it's lost, and is a quick way to prevent thieves from making purchases if you suspect suspicious activity.

5. Make Your Passwords Unique and Secure

If hackers gain access to your account passwords, they can steal your payment information or order items with your account and leave you with the bill.

Make sure you create secure passwords, such as a string of a few unrelated words separated by spaces, to minimize your risk. Avoid using the same password across different accounts; if one is hacked, multiple accounts will be vulnerable. Download a password manager like LastPass or 1Password to keep track of and generate secure passwords when prompted.

6. Update Software on Your Computer and Mobile Device

Software updates can seem like a drag, but if you get an alert to update your operating system or browser, do so right away. These updates are often released to protect consumers from new security risks. They can also help protect your data by reinforcing or upgrading your computer or phone's security features.

7. Watch Out for Online Scams

Beware of phishing scams in which fraudsters use the information they know about you, such as your name or hometown, to encourage you to divulge other personal data through email.

Scammers do this by embedding hyperlinks into emails or text messages that direct you to sites that collect your personal information or install malware onto your computer or phone.

Don't click on text or email links from a source you don't know, especially if they're asking you to give up personal information. There are several variations of phishing scams, including spear phishing, angler phishing and smishing. Use caution when asked to enter any personal information online or via text.

8. Monitor Your Credit and Identity

Regularly check your credit report to make sure no one has created new accounts in your name or has run up balances on your credit cards. You can also perform a dark web scan to find out if your Social Security number, phone number or email addresses are available to thieves on the dark web.

If you're concerned your personal information has fallen into the wrong hands, add a free initial fraud alert to your credit file. It will remain active for one year. File it with just one credit bureau, and it will be shared with the others automatically. The fraud alert notifies lenders pulling your credit report to take extra steps to verify your identity.

You can also block access to your credit reports altogether by initiating a security freeze, a free measure that prevents lenders from issuing new credit in your name. But by staying vigilant while shopping online, you can do your best to prevent the worst from happening, and keep your data and identity safe.