If you’ve been paying attention to the news recently, you have most likely noticed the plethora of headlines boasting the opportunity to claim a free $125 from Equifax, one of the three national credit bureaus that experienced a massive security breach nearly two years ago, in September 2017. To give a brief overview of the situation: Equifax has agreed to pay nearly $700 million to settle federal and state investigations into how the company handled its massive data breach that affected over 50% of Americans. The settlement states that an individual who had his or her data hacked is eligible to receive either up to ten years of free credit monitoring or claim a $125 payment. To determine if you are among the more than 140 million Americans whose information was compromised by the Equifax breach, use the Equifax claim verification form (this takes less than a minute to do!). After determining your status, the next question is, should you go for the $125 and never look back or sign up for the ten years of free credit monitoring? One thing is for sure: do something! Jack Gillis, Executive Director of the Consumer Federation of America, says “There should be no reason whatsoever not to file,” as the process is quite quick and easy.
To determine which claim to take, let’s talk a little bit about what exactly “credit monitoring” is. Credit monitoring is a service that alerts an individual about changes to his or her personal information, potentially fraudulent activity, or new credit inquiries, to name a few. One thing to note is that credit monitoring only involves an alert; it is up to the individual to take action on the matter. Before heavily weighing this option, check to see if you already have credit monitoring set up, as you may be using a site that offers credit monitoring like Mint, CreditWise, or Credit Karma. For example, if you receive alerts about activity regarding your credit cards, chances are you already have some kind of monitoring in place; however, take note that these free services may not be as comprehensive as the credit monitoring service offered by Equifax.
Once you’ve made a decision about which option to take advantage of, you can proceed with the simple online claiming process here. Take this opportunity with a grain of salt though – of the $700 million settlement, experts have said that only about $31 million is being set aside for the $125 cash compensations. In other words, if more than 248,000 people select the cash claim, the amount Equifax will pay out to each person will be significantly less than $125; and knowing that over 150 million Americans were impacted by the breach, this is likely to be the case. Nevertheless, it is undoubtedly worth filing a claim because if fewer people end up selecting the cash option, the money doled out to individuals who select the cash claim may be more than the anticipated amount. The deadline to submit a claim is January 22, 2020, but do it now before you forget!
On a final note, keep in mind that unfortunately, in this day and age of technology, breaches seem to happen more often than we would like them to. The Equifax settlement just received a welcomed back seat in the headlines when the Capital One breach surfaced and abruptly stepped in to share the center spotlight. When these breaches occur, it is prudent to assume the worst and take action to protect yourself – you will never regret being overly cautious and putting precautionary measures into place when it comes to your financial and personal security. Remember to routinely change your passwords, set up credit monitoring, freeze your credit, and always stay alert.