Six Ways to Avoid Identity Theft

Identity theft is a nightmare for its victims. Your personal data -- Social Security number, credit card numbers, and bank account numbers -- can be stolen by a thief posing as you who uses this information to spend thousands of dollars or more.

The damage goes way beyond money. Identity theft can have a devastating impact on your entire life, destroying your credit score and taking you months or even years to recover from the damage.

Some Surprising Data

The Wall Street Journal recently reported that an estimated 95 million Americans have been exposed to some risk of identity theft in the last two years due to breaches at companies, institutions, and government offices.

USA Today also reported that by year's end there will be 8.9 million cases of identity fraud, resulting in an average loss of $6,383 per victim. This crime is an epidemic, and has quickly become a billion-dollar crisis.

The Javelin Strategy and Research 2006 Identity Fraud Survey Report, believed to be the largest ever on identity theft, reveals some surprising results. Ninety percent of identity fraud in which the source can be determined takes place through traditional means, not as a result of the Internet.

Don't Be a Victim

Lost or stolen wallets, checkbooks, and credit cards account for 30 percent of cases in which identity thieves gain access to personal information. That's right, it's the most frequent way that identities are stolen -- more than online transactions, more than stolen mail, and more than computer hacking.

According to the survey, the No. 1 misperception surrounding identity theft is that consumers are helpless to protect themselves. The truth is that many causes of identity theft are beyond our control. But taking a proactive stance to detect fraud will keep you from being a victim.

Here are six things you need to know to fight back against identity theft: