By now, you've probably heard the news that Equifax, one of the three major credit bureaus, experienced a major data breach that could potentially impact a whopping 143 million Americans. As a result, criminals now have access to loads of information that can be used to perpetuate identity theft crimes, from birth dates to addresses to driver's license numbers. Countless Social Security numbers were also obtained by the hackers, which means that not only might your identity be compromised, but your Social Security benefits as well.
How your Social Security payments could be in danger
The primary concern with regard to the Equifax breach is that criminals might attempt to open new credit cards in consumers' names, or use their existing cards to rack up charges. But those same unscrupulous individuals might also attempt to siphon off Social Security income from otherwise unsuspecting workers and seniors.
Let's consider how this might apply to a senior currently receiving benefits. If criminals get hold of someones's personal information, there's nothing to stop them from redirecting their Social Security payments toward a new bank account, collecting and withdrawing that money themselves, and leaving the actual retiree -- once they discover the problem -- to prove they're the rightful recipient.
Then there are those who have yet to file for Social Security, whether because they're still working, are too young, or are waiting until later so as to boost their monthly payments. Here's what could happen if you're one of these folks: Someone could, in theory, access your information at some point or another, file for benefits as you (either immediately or once you become eligible), direct those benefits to a new address, and collect them for years with you none the wiser. Then, when you finally decide it's time to file for benefits, you'll learn that you have supposedly been receiving them for years.
The burden will then be on you to prove to the Social Security Administration that your identity was stolen, and that you haven't actually collected a dime yet. Resolving that issue could take months, or even years, during which time you could end up missing out on the income you need.
Oh, and to make matters slightly worse, guess where the Social Security Administration gets much of its information from? That's right -- Equifax. Talk about ironic.
How to protect yourself, and your benefits
If you're wondering how to protect yourself from identity theft in general, my colleague, Matthew Frankel, offers some great advice here. But if you're specifically concerned about your Social Security benefits, being hyper-vigilant can help.
If you're already receiving benefits, make sure your payments continue to arrive as scheduled. If you see one missing, report it immediately. Furthermore, retain all documentation you receive from the Social Security Administration so that if you do end up needing to prove that you are who you claim to be, you'll have the paperwork in place.
That latter piece of advice is just as important if you're not yet collecting benefits. In fact, it's perhaps even more important, because if you're not regularly receiving income from Social Security, you'll have less of an indication that something is amiss than someone who clearly does receive a benefits payment. On the other hand, if someone attempts to file for benefits on your behalf, and you have records dating back to an earlier period than that, you may have an easier time convincing the Social Security Administration that you've been victimized.
One final thing: None of the above is meant to frighten you, or cause undue stress. Given the amount of data that was potentially exposed in the recent breach, there's a good chance that you'll never wind up impacted with regard to Social Security or any other aspect of your credit or finances. On the other hand, it's better to be vigilant than to wind up sorry, and a few easy steps, like preserving the aforementioned paperwork, could save you a world of trouble if you do end up encountering a problem.
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