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Credit Monitoring

Credit monitoring services track your credit file daily and alert you whenever there is a change.  In addition, they periodically notify you of your most recent credit score.  As a result, these services offer 2 benefits:
  1. Help you prevent identity theft -- Main Benefit
    Most identity thieves will attempt to open new accounts under your name.  This will result in a credit inquiry posting to at least 1 of the 3 main credit bureaus. Credit monitoring services alert you within 24 hours of any change to your credit report, including credit inquiries.  Once you see that you can immediately follow up with the lender or with your credit monitoring service to stop the identity theft before any actual damage is done (i.e. they take a loan under your name for which you are responsible of paying off, unless you prove that your identity was stolen).
  2. Stay on top of your credit score and as a result you will always know your credit standing.


Differentiation between services:

First of all it is important to realize that there are a lot of different versions of credit monitoring and that every company tries to pitch you that their service is much better and different than anything else out there.  The reality is that all of them are very similar and that the number of companies that are actually behind the service is a much much smaller number than it actually seems.

For example, one of the actual providers of credit monitoring services is a company by the name of 'Intersections' and on their website they claim that: "Many of North America’s leading financial institutions already use Intersections’ services, often under their own private labels...".  What this means is that maybe the credit monitoring service that Citibank offers under their own private label is supported by the same company like the credit monitoring service that Discover Card offers, even though they both try to make their services look unique.


Popular features:

Here is a list of the most common features:

  • Number of bureaus that they monitor:  There are 3 main credit bureaus in the U.S. Some services will monitor 1 of them and others will monitor all 3.
  • Provide you with your credit score:  Again each credit bureau has its own FICO score and different services provide you a different number of credit scores and at different frequencies.
  • ID Theft Insurance:  Amount of coverage for expenses related to recovering from an identity theft event. Usually they have a deductible.

Bottom line:

Bottom line is that we believe that credit monitoring is something that everyone should have -- mainly because of the hassle involved if you end up being a victim of identity theft.  At the same time the risk that you become a victim of identity theft is still low (below 5%) and thus we do not strongly recommend that you get a credit monitoring service.  However, if you have concluded that you want one here is our recommendation:

  • If your credit is very good or better (i.e. your credit score is above 700) then you should only care about a credit monitoring service that provides you an alert whenever there is a change to any of the 3 credit bureaus. Nothing else! You should not care about credit scores, ID theft, or anything else they might try to sell you on.

    Our recommendation:  3-in-1 monitoring from Equifax for $12.95 per month  -- this is the least expensive we could find that met our criteria


  • If your credit is less than very good (i.e. your credit score is below 700) then you should only care about a credit monitoring service that provides you both an alert whenever there is a change to any of the 3 credit bureaus and a credit score update from only 1 bureau on a periodic basis so that you know when your credit standing has changed significantly and thus qualify for lower rates on your loans and even car insurance. Nothing else! You should not care about credit scores, ID theft, or anything else they might try to sell you on.

    Our recommendation:  Identity Guard for $12.99 per month  -- this is the least expensive we could find that met our criteria


Good luck,
Your Financial Ally