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We have all heard of the tales of identity theft victims and the headache that trying to recover from it brings. We have been told about protecting our online activities in order to help avoid becoming a victim. Many do nothing and just hope that it does not happen. Others are feverous in their efforts.

Taking some steps to help prevent yourself from becoming a victim is not hard if you have a strategy. The following will not protect you 100%, but rather takes the approach that what vulnerabilities that you do have are very small and would cause no more than a pinch if something were to happen.

Here are five simple steps that you can take to online financial security that will limit your liability. The concept here is to make your ‘footprint’ as small as possible financially online.

  1. Open a new checking or savings account. This is the first step and it will take some investigation in order to see if you can make it work. Open a new checking or savings account with the SAME bank with which your primary banking is performed. This will become the new account with which you perform online financial transactions. If you only make payments with a bank routing number and account number, a savings account will work. If you desire to be able to use a debit card then you will probably have to open a checking account. The reason that you want will want to do this with the same bank is because you will use online transfer abilities to move money from your primary account to this new account and you want those moves to be instantaneous.
  2. Set up transferability and debit card. Make sure that the bank allows you to freely transfer money between accounts as mentioned before. Request your debit card on the new account. When it arrives, activate it and have it ready to go for online financial transactions.
  3. Fund your new account. Place $20 or so in this account just to keep it open. Some banks require an initial deposit of $100 or so and a minimum balance. Find out what the requirements are for your bank and then follow them. Understand that if you keep only a small balance in the account, you might incur a monthly fee. This will be part of the small price that you pay for maintaining your online security.
  4. Begin to use only this new account and debit card for your online transactions. This will be the new account from which you make payments, etc. Right before you make a payment log onto your primary account and transfer only enough money to satisfy the transaction amount to your new secondary account. Make sure that there is never more money in the account than is absolutely necessary.
  5. Change your credit cards or debit cards on any other account that you have already used in online transactions. Contact your credit card companies or banks and tell them that you think your number on your card might be compromised and then have them issue a new one. This step will take that card number out of ‘circulation’ with other online entities. If you need to, go online to the places that use your card number and update your payment methods and add your new card or account number. Remember to delete the old one.

What you will have done is to make your primary checking account completely isolated from being in ‘circulation’ on the Internet. Your secondary account will be the one which will be your online ‘footprint’ and the point at which you will be vulnerable. However, since you are keeping only a small amount of money in that account, the liability will be small.

This sounds like a lot of work and it does require some up front setup. However, once it is done, it is very easy to use and helps keep your risk low in online transactions. Look at it this way: an ounce of prevention is worth a pound of cure.



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