Compare Credit Monitoring Services

In spite of the precautions in Identity Theft Protection, anyone is susceptible to identity theft. Be aware that the odds of its occurrence can be lowered through the use of the practical measures, and there is no way to avoid it completely by using credit monitoring services.

Credit Monitoring is Early Detection

Understand that a credit report monitoring service doesn’t prevent identity theft; it only puts an early warning system in place—alerting you to new entries and inquiries to your credit report—so that you can take action early and mitigate the damage in the event that identity theft does occur.

Credit monitoring is very confusing, as each of the credit bureaus has their own version available, as does FICO. Moreover, banks, credit unions, and insurance companies have identity theft protection products, and even those are often actually provided by third parties.

In my opinion, the best solutions are ones that involve the credit bureaus directly for two reasons. First, if something runs afoul with reporting after a bad event, you can hold the bureau's feet directly to the fire... as opposed to each party pointing a finger at the other. Second, who better to perform credit report monitoring than the one with the actual data repository? So for the purposes of this review, I'll compare credit monitoring services from the credit bureaus and FICO only.

A Snapshot of the Best Credit Monitoring Services Available

As the summary in Table 9 clearly shows, some options aren’t options at all. Trans Union’s ID-Fraud Watch is lackluster, as is Experian’s Credit Manager. FICO’s limited monitoring of one each of the Big Three credit bureaus also leaves a lot to be desired.

Noteworthy: Trans Union
Trans Union’s ID-Fraud Watch is $10.95 per quarter ($43.80 per year) and provides weekly monitoring of Trans Union’s credit report. For an additional $5.95 per quarter ($23.80 per year), it will also monitor Trans Union’s proprietary TrueCredit Score. It permits consumers a free credit report each quarter. It does not offer monitoring of the other bureaus.

Trans Union also recently began offering 3-Bureau Credit Monitoring for $9.95 per month ($109.45 per year; one month free). However, it won’t sell you this product unless you also purchase a 3-in-1 credit report for $29.95, making the total price $139.40). It will then monitor all three reports and provide 24-hour notice when something changes on your report. In addition, you get unlimited access to the Trans Union credit report, enabling you to get a new report anytime you like.

Noteworthy: Equifax
Equifax’s Credit Watch Gold with 3-in-1 Monitoring will monitor the Big Three credit bureau reports daily (24-hour notification) at a cost of $9.95 per month ($119.40 per year. It offers unlimited Equifax credit report access. Equifax’s Credit Watch Silver monitors the Equifax report daily and also notifies the user of key changes within 24 hours. It costs $4.95 per month ($59.40 per year) or is discounted for an annual payment of $49.95. It offers two free reports, one at enrollment and one anytime during the subscription period.

Conclusion
The credit monitoring of a FICO score may seem useful and nice to have, but this really isn’t what monitoring is all about. It’s about early detection of identity theft. Having said that, I believe that Equifax’s Credit Watch Gold with 3-in-1 Monitoring and Trans Union’s 3-Bureau Credit Monitoring do exactly that, covering all three reports while providing daily monitoring and 24-hour notification. Both also offer unlimited access to new reports (for each), which can be useful for those who are earnestly tracking their credit restoration progress and wish to pull their reports frequently in order when creditors are reporting account information.¹⁷ (See “Factors That Affect Your FICO Score” in Improve Credit Scores.)

It troubles me that Trans Union has rolled its credit monitoring solutions into its TrueCredit division. They’re doing this so that they can build a customer base in order to hawk what amounts to a useless credit score product (TrueCredit; see Improve Credit Scores).

Personally, I like the Equifax solution the best right now, since their web site is much better at explaining their products and prices. Furthermore, Equifax is the only credit bureau that currently has a close working relationship with FICO, by providing a Score Power score (a FICO Score) to consumers. Although a Score Power score isn’t included with Equifax’s Credit Watch Gold with 3-in-1 Monitoring, being on their customer list will probably get you on their mailing list for special discounts of their products. Just be sure to opt-in for internal offers at the time you order.

Each of the services summarized here offers identity theft insurance in the event of identity theft, but there are so many caveats that it’s not worth considering.¹⁸ Ever hear a plug from a credit report insurance company like, "Insured for a million dollars!" This is ridiculous; identity theft insurance is limited to actual losses, which amounts to very little. Fraudulent credit card charges are limited to $50 per credit card (and debit card) by federal law anyway. And who wants to log the hours they spent away from work in resolving the situation. So it's ten hours. So what? How much do you make an hour? How much can you prove you lost? Do you need a boss's statement? The limitation of loss doesn't extend to pain and suffering, either. Fughetaboutit.

As you repair your bad credit, you may want to consider protecting it by using credit monitoring or by taking another preventative measure, such as a Security Freeze. It used to be available only to California residents, but other states are getting on board. (See Active Duty Alerts, Fraud Alerts, and Security Freezes.)

17. Check the credit bureaus’ Web sites (Equifax.com, TransUnion.com, and Experian.com) for the latest offers.
18. Equifax limits issues to ID theft arising out of the Internet, for example. Trans Union listed a summary of benefits, failing to provide the complete terms. Experian doesn’t appear to provide any coverage, while FICO has coverage for the Identity Theft Security Deluxe, which mimics the insurance from Trans Union (third party insurer is AIG eBusiness Risk Solutions).