Credit monitoring services cost between $10-$30/month. The companies tout a bevy of services, including:
– Routine monitoring of public databases to find fraudulent activity with your social security number and or bank account information
– Credit scores
– Alerts when there are changes to your credit scores
– Access to credit reports
– Risk analysis – customize reports to determine if you financial activities can be undermined
– Identity theft protection
– Strategies to improve your financial profile
So is it worth the money?
Since there is only one federally mandated place to receive one free copy of your credit report annually (annualcreditreport.com), we know that paying for a credit report (or even signing up for a temporary trial) is beyond unnecessary.
FICO scores used by lenders as computed by the Fair Isaac Corporation are only available through FICO or a small number of authorized partners. Selecting a service that provides a non-industry standard 3-digit scores can be utterly useless information.
No monitoring service can prevent theft. They can alert you after suspicious activity has occurred. However, you can do the same by regularly reviewing your credit report and bank accounts. Some offer identify theft insurance which will reimburse your out of pocket expenses as a result of the theft. The Javelin Research group found that the amount of out of pocket expenses victims suffered last year was: $0 (priceless).
The risk analysis and credit building may be worthwhile services. Ask yourself, do you need to pay a monthly service for this continued analysis.
On its face, the monitoring service does not appear worth the monthly fee. Also, unless you pay for monitoring from myfico.com directly, you run the risk of receiving less than helpful information. Alternatives would be:
1. Pull your free credit report. If you download a different report once a quarter (one from each of the 3 reporting agencies), then you can essentially monitor your own credit profile on a nearly annual basis.
2. Purchase your score from Fico.com. You can buy a score from each agency or pay additional money for all three.
3. For those who’ve been victims of identity theft, place either a free 90 day fraud alert or pay $10 (per agency) for a credit freeze. The freeze can be lifted for an additional fee when you need something requiring credit. Requesting a fraud alert with one agency will trigger the same alert with the other two.
4. Fraud Assistance – Depending on your risk level, history, and current situation, this might be the only truly helpful service. There are some cases of ID theft that are very complex and professional assistance may be in order. In most cases, working with your bank or credit card companies is very effective and free.
Final thought. I don’t think the creditor monitors are worth the expense (in general).