Protect Yourself

IN 1989 THE REPLACEMENTS HAD their only commercial hit song with “I’ll Be You.” In this day and age, that phrase has taken on a more sinister tone. Identity theft is one of the fastest growing crimes today. The 2010 Identity Fraud Survey Report stated there were 11.1 million adult identity fraud victims in 2009. While you may not be able to completely prevent your identity from being stolen, there are steps you can take to help protect yourself from becoming an easy victim.

One important step is to protect your Social Security number. Never carry your Social Security card with you unless you are going to need it. Don’t have it printed on your checks or write it on the check at the request of the clerk. Don’t give your Social Security number over the phone unless you personally make the call to an organization you trust.

Make sure you keep the receipts from your credit card as they may contain your card number. It is always a good idea to keep your receipts and compare them against your monthly statement. When shopping, keep the receipts with you; if you leave them in a bag and the bag is stolen, your card number may be with it. Instead of just throwing out financial records such as credit card receipts, statements and even offers for credit, shred them. The best method is to use a shredder, but ripping the statements into very small pieces can be effective if done with care. With the cost of a personal shredder less than the cost of a family night at the movies, it is an investment that can help you sleep securely.

Children are warned not to talk to strangers. This important advice also applies to computer e-mail usage. If you receive an e-mail from someone you don’t know, especially if it has attached files or hyperlinks in the message, don’t open it. Clicking on the link or opening the attachment can expose you to viruses or spyware that can record your keystrokes. Don’t access any Web sites directly from the e-mail; instead use your stored bookmark or type the address directly into your browser.

A few years ago I received an e-mail stating there was a problem with my bank account and I should click the link to address the problem. The only issue was that I never had an account with that bank. Our office sometimes receives calls from clients regarding an e-mail claiming to be from the IRS stating a refund is due and they need personal information to send it. The amount is usually an odd number that isn’t too large and seems rather ordinary. This is a common scam that surfaces throughout the year. Generally the IRS doesn’t send unsolicited e-mails to taxpayers. In addition, the IRS doesn’t discuss tax account information or use e-mails to solicit sensitive financial and personal information.

It is a good idea to periodically review your credit report. You want to make sure the information is accurate and be on the lookout for any activity that may be fraudulent. You can get your credit report free once a year. Contact the Annual Credit Report Request Service online at www.annualcreditreport.com or call (877) 322-8228. You may also request the report in writing; see the Web site for details. These are only a few of the steps you can take to protect your identity. It is hoped by following these steps, someone else won’t be you.

A Process, Not A Destination

As the newness of 2010 slips away, I am reminded of a line by John Lennon: “Life is what happens while we are making other plans.” A new year, new decade and bright future inspire many resolutions and if you haven’t already done so, make 2010 the year to get your financial house in order. Financial planning may seem like a daunting task but it really parallels the structure of a fitness program.

The first step is an honest assessment of where you stand. Do you have an updated will? Do you have a power of attorney? What are your assets and where are they located? What debts do you have and to whom? Are you properly protected and insured from unexpected events? This is the financial equivalent of seeing your physician before starting a fitness program. You have to know where you are before you can get to where you are going.

The next step is to determine your goals and values. What is important about money to you? It is critical that you think about what is really important to you. If you don’t have the desire or your goals don’t really tie to your values, you are unlikely to pursue them for the long term. Everyone’s goals will be different; dreams and visions are as unique as the individual. Common long term goals are to be able to retire comfortably, to help children or grandchildren receive a college education, to travel, to start a second career or do mission work. Shorter term goals such as a new car, family vacation or home renovations should also be included. Once you have identified where you want to be and where you currently are, the planning part is a matter of plotting the course from one point to another.

Just as you may hire a personal trainer or fitness coach, you may need a planner to help assist you in developing and monitoring the plan. Make sure you find someone who can assist you along the way and will work with you in putting all the pieces together. When people think of financial planning, they often think of investments or insurance. Those may be pieces of the financial plan, but by no means are they themselves a financial plan. Just as proper nutrition, exercise and rest are all parts of a fitness program, without the proper balance you can’t achieve your fitness goal efficiently, if at all. Estate planning, debt management and income taxes all come into play with a financial plan. If you only focus on one or two of the pieces, you will hold yourself back.

Financial planning is a process, not a destination. Life rarely works out exactly the way you plan. At the beginning of the last decade I thought I would never change another diaper, yet ten short years later here I am looking at another college education to fund and a seemingly endless need of diapers. The things that were important then aren’t as important now and thus my plan has changed. The plan isn’t written in stone. It’s not something that is done once and put on a shelf – it is adjusted as life dictates.

Just like thinking about exercise won’t make you fit; a financial plan without action won’t get you where you want to go. 2010 should be the year you make a plan for life before life happns while you're making other plans.