What Is Credit Monitoring and Why Is It Important?

Credit monitoring and identity theft protection services help you monitor your credit activity and catch fraud before you become a victim of identity theft. ID theft services include credit monitoring, but you can also sign up for free or paid standalone credit monitoring services like Credit Karma.

So, what do you get with identity theft protection services versus just credit monitoring? Additional features like identity theft insurance, access to remediation specialists, and cybersecurity extras like antivirus protection and a virtual private network (VPN), just to name a few.

We break it all down for you, give you some tips for keeping your credit safe, and even recommend our favorite tested ID theft services. Check it out if you want to stay secure from scammers, hackers, and identity thieves.

What is credit monitoring?

Credit monitoring services monitor specific aspects of your information, like your Social Security number, address, medical files, home title, and more. Through an online dashboard, you’re able to keep an eye on your fluctuating credit score as well as other things that have the potential to impact it.

What does a credit monitoring service do?

The service first takes your Social Security number (SSN), name, address, birth date, and other relevant information to access reports about you. Then, in your dashboard, you’ll have access to the different categories your credit monitoring service is watching. This allows you to stay on top of changes and detect suspicious activity before it has a chance to wreak havoc on your credit and identity.

Free services

You can access free credit monitoring services through platforms like CreditWise from Capital One or apps like CreditKarma by Intuit. They use your Social Security number to monitor your daily credit fluctuations. CreditKarma, for example, offers tips on improving your credit, loan, and credit card offers, and the free service even tracks financial accounts.

Paid services

Paid credit monitoring services usually include more features, such as ID theft insurance and identity theft protection. They can also include parental controls, online safety software, and sexual predator monitoring for your area. Plus, you’ll usually get a remediation specialist to help you if you’re a victim of identity theft or have a credit problem.

Insurance

Paid services usually include some type of insurance to reimburse you or help offset the costs of restoring your credit if there’s an incident. The best services include a remediation specialist who will help you with these tasks and help pay out the insurance benefits.

Security alerts

Dark web scanners are also usually included in paid (and some free) credit monitoring services. This feature can let you know if your passwords have been compromised or if your information is mentioned on the dark web.

Fraud detection

This is one of the more critical aspects of credit monitoring. A good service will send you fraud alerts to catch any suspicious activity early. It may even help you contact your financial institutions or assist you in freezing your credit while you figure out what’s going on.

Credit building tips

Free and paid services offer insight into building, improving, and maintaining your credit. Free services tend to offer you loan and credit applications, while paid services sometimes have guides or just general tips displayed. Some services even contain credit calculators to let you know how certain actions will affect your credit or give you timelines for paying off your debt.

Daily credit monitoring

Credit monitoring comes standard with all these services, but some may update differently. Most paid services include daily or weekly monitoring, while some free services offer regular credit monitoring. This feature can also alert you to missed payments so you can catch them before they impact your credit.

New account alerts

You’ll be notified when a new account is opened using your name and SSN. If someone tries to get a credit card or loan in your name, this is the best way to find that out quickly. Otherwise, it could take months before you realize it.

Track FICO and VantageScore

Lenders usually look at your FICO score when determining loan eligibility, but your VantageScore is also used. Credit monitoring services allow you to keep an eye on these scores so you always know where you stand.

Additional features

Different services offer additional features, depending on which one you choose. Some include antivirus software, while others offer parental controls or include monitoring for children’s credit for free with your plan. You’ll choose a service that caters the most to your unique needs.

Can credit monitoring prevent identity theft?

Credit monitoring is an excellent way to stay on top of your credit health. While you may be able to catch identity theft in its early stages, you likely won’t be able to prevent it completely with credit monitoring services alone.

The best credit monitoring with identity theft protection gives you early warnings, insurance, and remediation specialists who can make sure an identity theft incident doesn’t become a costly, time-consuming headache.

Credit monitoring services pros and cons

Identity theft protection services pros and cons

What to look for in a credit monitoring service

When deciding on what credit monitoring or identity theft protection service you want, there are certain features you should consider. You’re looking for the best ratio of features to cost, ease of use, and general value. Below are features worth looking into:

• How many major credit bureaus are monitored (1 or 3)
• Any hidden fees or cancellation requirements
• Any complaints filed against the agency
• Any history of data breaches
• Value compared to cost
• How many people are covered
• Insurance premiums per person
• The inclusion of white glove remediation
• Extra cybersecurity features like parental controls or antivirus protection
• Types of alerts (e.g., dark web, fraud, credit report, etc.)
• Multiple areas monitored like credit, medical records, home titles, etc
• Multiple options for contacting customer support

Best identity theft protection services with credit monitoring

Identity theft protection safeguards you against identity theft. We’ve tested the following services and recommend them because they include protection for children's identity, credit monitoring, identity theft insurance, and additional features like VPNs and antivirus software.

Tips for protecting your credit

1. Don’t click on suspicious links in emails or text messages.
2. Request your free annual credit report and read it through in its entirety.
3. Use credit monitoring to catch any fraudulent activity early.
4. Use strong passwords on all accounts.
5. Monitor your monthly automatic bill payments.
6. Arrange payment options with your creditors if you fear you may fall behind.
7. Use a biometric login, two-factor authentication (2FA), or multi-factor authentication (MFA) on your accounts.
8. Freeze your credit until you need it.
9. Shred documents with sensitive information.
10. Use identity theft protection.

FAQs

Bottom line

Credit monitoring is a way to watch the activity on your accounts to make sure nothing fraudulent ruins your credit. By monitoring your SSN, credit monitoring sites see what’s being used in your name. Using a reputable credit monitoring or identity theft protection service helps you stay on top of potential issues and can protect you if you are ever the victim of identity theft.

The best prevention you can take to safeguard your credit and your identity is to sign up for an identity theft protection service. You’ll be able to monitor your accounts, stay vigilant about personal information, and even get financial and remediation assistance if you’re ever a victim of identity theft.

The best identity theft protection services offer all this and more — and are worth the investment in the long run.