Most people use credit monitoring to get notified about fraud as quickly as possible and, ultimately, minimize its impact on their finances. It entails signing up for a service that keeps tabs on one or more of your major credit reports and then notifies you whenever a new account gets opened under your name, someone makes an inquiry into your file, or other potentially suspicious activity crops up. Many credit monitoring packages also provide you with access to at least one of your credit reports and credit scores. As such, consumers often use credit monitoring simply to keep track of their credit building progress.
A variety of different companies offer credit monitoring services, including the three major credit bureaus (Experian, Equifax, and TransUnion) and most of the major banks. It’s no surprise that there’s a large market for such a product either, as identity theft has topped the Federal Trade Commission’s annual list of the most common consumer complaints for more than a decade. And while credit monitoring won’t, strictly speaking, prevent identity theft or related credit card/loan fraud, it does have the potential to alert you about unauthorized access to your personal information before you would otherwise notice a problem.