You are nearing retirement age and wonder how much money you can expect from the federal government in Social Security benefits each month after leaving the workforce. The short answer? The amount of money you earn while working determines your monthly benefits. Of course, it is not entirely that simple. The Social Security Administration also factors inflation and other formulas to determine your final monthly benefit. The length of your working career and how early you retire will also impact your monthly benefits. Here’s a closer look at what goes into determining the amount of money you will receive each month:

Your Income

When determining your monthly benefits, the Social Security Administration considers your 35 best working years — the years in which you earned the most income. It is important to note that the Social Security Administration might not use all of your earned income during these years when calculating your monthly benefit if you are a high-wage-earner. In 2023, for instance, every dollar that you earn above $160,200 will not count for Social Security benefits purposes. You will also face income limits if you take Social Security benefits and continue to work between the ages of 62 and your full retirement age. Full retirement age is somewhere between the ages of 65 and 67, depending on your birth year. In addition, if you have not yet reached your full retirement age and earn more than $21,240 a year in 2023, then $1 will be deducted from your benefits for every $2 earned over $21,240.

The Calculations

The Social Security Administration takes the average of your 35 highest-earning years to determine your monthly benefit. That figure adjusts for changes to average worker wages since the period in which you earned your money. That is known as adjusting or indexing workers’ earnings. This step makes sure that your future benefits reflect the rise in the standard of living that occurred during your years of working. The Social Security system is also progressive in that lower-wage earners receive a higher percentage benefit than higher-wage earners do. This is because the system returns a higher percentage of pre-retirement earnings to a lower-wage worker than a higher-wage worker. The Social Security Administration uses all this information to create your AIME or averaged indexed monthly earnings. Eventually, the Social Security Administration calculates your Primary Insurance Amount or PIA. That is what you will receive each month from Social Security.

Retirement Age

However, the retirement age significantly impacts the amount of Social Security benefits you receive each month. So, if you retire too early, you will earn less each month in benefits. As of 2018, the earliest age to begin collecting Social Security benefits is 62. However, if you start receiving your benefits at this age, you will receive reduced monthly benefits. There’s a reason for this: The federal government figures that you will be collecting your monthly benefits for a longer time if you retire at age 62. So monthly benefits are reduced for early retirees to make sure your payments equal out over your lifetime. How much of a reduction will you face by retiring early? According to the Social Security Administration’s website, primary wage earners can expect to receive just 70 percent of their total monthly benefits if they retire at age 62 instead of 66 or 67. In addition, the spouses of primary wage earners will take an even more significant hit; they can expect to earn just 65 percent of their total monthly benefits if they retire at the age of 62. The message seems clear: It makes more financial sense to begin collecting Social Security payments at or after full retirement. But, of course, even this matter is more complicated than it seems. For instance, if your health is poor, you might not live a long life after retiring. So collecting benefits early on might make sense. Also, if you are out of work and can’t find a new job, it might make more sense to collect benefits earlier rather than later. As you near retirement age, be sure to check for the Social Security benefits statements that the government has sent you since you turned 25. These reports list the amount of income you have declared each year and provide an estimate of how much Social Security money you can expect to earn each month, depending on the day you retire.

How are Social Security Benefits Calculated?

View Resource How are Social Security Benefits Calculated?
The traditional view of retirement is changing, and it is changing quickly. For example, retirement was when you could travel or spend long days with your grandchildren. These days, however, increasingly, retirement still involves some amount of work. The good news? Research suggests that working at least part-time in your retirement might be right for you, both financially and physically. The key depends on what work you do and how you save the extra money you earn while taking on a part- or full-time job during retirement.

Need to Work or Want to Work?

The unfortunate fact is that many retirees have no choice but to work, at least on a part-time basis, during their retirement years. That is because these retirees have not saved enough money to live comfortably during their retirement. Levels of optimism and confidence from retirees that their retirement will remain financially secure have been steady, while retirees who feel very confident continue to increase. According to the 2022 Retirement Confidence Survey conducted by the Employee Benefits Research Institute, 73 percent of workers remain positive towards their retirement, with 28 percent very confident. However, the same study showed that 24 percent of retirees are not too confident or not confident at all in the financial security of their retirement. In other words, many U.S. residents will need to work longer if they want to face a comfortable, happy retirement. Of course, there are plenty of reasons people would want to work during their retirement years. For one thing, the world of work has changed. Fewer people are making a living doing manual labor. As a result, retirees can work longer if work mainly involves sitting in front of a computer screen or making telephone calls. A June 2014 report by the Society for Human Resource Management (SHRM) references the new ‘retirement workscape.’ In this workscape, retirees will continue to find satisfaction from work even after they retire from their primary career. The SHRM report outlines four different phases of the retirement workscape: Pre-retirement involves taking meaningful steps to prepare for their post-retirement career. Many human resources departments are even engaging employees who are getting ready to retire to explore ways that they might be able to continue work. Again, flexibility and finding work that is motivating are the key factors. Once the retirement decision occurs, most retirees want to take a little time off or have a career intermission. That gives them the ability to relax, recharge and retool. Typically, this career intermission lasts about 2.5 years. Re-engaging in the workforce lasts for about nine years on average, according to the SHRM report. However, that re-engagement comes with a new balance between work and leisure and a greater emphasis on flexible careers. Finally, the fourth phase allows retirees to rest, relax, socialize and travel. That is the traditional view on retirement for most people. However, such traditions are changing or facing postponement to a later retirement stage.

Impact on Other Retirement Income

Financially, working longer will offer better protection for your other sources of retirement income. The extra monthly income you generate from work can help cover your insurance, grocery, and medical-care costs. That will reduce the need to tap into your retirement savings. That extra income may allow you to hold off collecting Social Security benefits until later in life. Remember, the longer you wait to begin receiving Social Security, the more significant your monthly benefits will be. (This holds until you hit the age of 70. After this point, your monthly benefits will no longer increase.) Choosing to work after you hit retirement age is an important decision. However, in suitable cases, doing so might provide you with the financial and health benefits that could make your retirement years better.

Working in Retirement

View Resource Working in Retirement
Retirement is something you may have been looking forward to for quite some time. You may have been saving for it since you began working with the hopes of leading a comfortable lifestyle once you are no longer officially bringing in a consistent and well-earned weekly, bi-weekly or monthly paycheck. However, a few complications, such as people living longer than expected after retirement and the upheaval in the market that took place during the Great Recession, may have put a few wrinkles in your plans. That has left many people looking for ways to supplement their retirement incomes, perhaps just like you. The good news is that there are plenty of opportunities available for you to do just that. First, however, you must make sure you do not cross specific lines with Uncle Sam, or you could face a few unexpected and unpleasant penalties for doing so. Here’s what you need to know to avoid making costly missteps while supplementing your retirement income.

Income Limits in Retirement

According to the Social Security Administration (SSA), income limits mainly apply to Social Security Benefits for people who are not yet at full retirement age. Full retirement age is the age at which you qualify for 100 percent of your social retirement benefits each month. For many years, that age had been 65. However, if you were born after 1943, your retirement age is at 66, which then slowly increases until it hits 67, which then applies to those born after 1960. If you have not yet reached full retirement in 2023, your annual earning limits are $21,240. Therefore, any earnings above that amount will result in a decrease in your monthly retirement benefits. For those who will reach full retirement age in 2023, limits on earnings in the months leading to that date are $56,250. For this purpose, the SSA only considers earnings for the one month before your full retirement age. This includes income from the following: It does not include income from the following, though: Once you reach full retirement age, you have no limits on your earned income and will continue to receive your full benefits.

Opportunities for Generating Retirement Income

Generating income during retirement is more manageable than you might believe. Most retirees do not need to rely on a full-time salary. Instead, some are only looking to supplement their incomes, make their funds last longer, or afford a few desirable luxuries during their golden years. That means you do not need to embark on a new career to make ends meet, though you could enjoy a nice part-time income or turn a hobby into a little extra cash. These are a few ideas you might want to consider for retirement income. There are nearly endless opportunities to earn money during retirement to supplement your income or fund your dreams.

Benefits of Working in Retirement

Oddly enough, the benefits of working in retirement are far more than financial. While some people initially decide to work during retirement for economic reasons, many keep working throughout retirement for deeply personal reasons. These are just a few benefits you can experience by working during retirement. However, the bottom line for some people is that they enjoy working and wish to continue doing so. Of course, there are financial benefits to consider for working during retirement. Many of these are too big to be discounted or ignored. That is especially the case for retirees concerned that their nest eggs are not sufficient to meet their needs and expectations. That includes reasons like the following: Retirement does not mean you have to sit at home and take up knitting, not that there’s anything wrong with that. Many of today’s retirees are more energetic and active than ever before. Sometimes, that requires a little creative financial planning before retirement, and at other times, it might mean you want to continue earning well into your retirement. But, it is your retirement, so do what you please.

Supplementing Your Retirement Income

View Resource Supplementing Your Retirement Income
Levels of optimism and confidence from retirees that their retirement will remain financially secure have been steady, while retirees who feel very confident continue to increase. According to the 2022 Retirement Confidence Survey conducted by the Employee Benefits Research Institute, 73 percent of workers remain positive towards their retirement, with 28 percent very confident. However, the same study showed that 24 percent of retirees are not too confident or not confident at all in the financial security of their retirement. Into which segment of this statistic do you fall? Will you run out of money during your retirement? If so, what can you do about it? The good news is that you can take steps to boost your odds of enjoying a retirement free of money stress. However, you must first identify whether you have saved enough for retirement to do this. Moreover, if you have not, you must then take the sometimes challenging steps to change your negative financial situation.

Determining if You Have Enough Savings

Before determining whether you have saved enough for retirement, you must calculate how much money you need each year. Financial experts say that most retirees will need anywhere from 70 percent to 85 percent of their annual pre-retirement income to live comfortably after leaving the workforce. That varies, though, depending on the lifestyle you wish to live during your retirement. If you want to travel the globe with your spouse, you will need more money each year than you would if you are looking forward to relaxing with your grandchildren. Likewise, if you want to help your children buy their first house, you will need more savings than if you are planning to spend your days catching up on all that reading you missed while working. At the same time, you need to calculate which of your expenses will change after retirement. For example, you might no longer have to make a monthly mortgage payment. That is a positive. However, you might also need to spend significantly more on your health care. That is a negative. Maybe you will drop life insurance and disability coverage or do away with one of your cars. Next, you need to estimate how long you think you will live after retiring. That, of course, is no easy task. In general, though, people are living longer today. It’s not unusual to live into your late 80s or beyond. Depending on when you retire, then you might have 25 years or more left to live.

If You Don’t Have Enough

After making these calculations, what if you determine that you have not saved enough for retirement? First, don’t panic. It is scary to come to grips with a potential lack of retirement funds. However, once you know you are in financial trouble, you can take steps to change your fortunes. For instance, you might choose to sell your home. That can provide you with an immediate infusion of cash. Besides, if you downsize, you will have to spend less time and money on maintenance, lawn care services, and snow-plowing companies. Again, that can add up to significant savings. You might also consider moving to a more affordable community. By living with lower gas, groceries, and other regular expenses, you can reduce the monthly strain on your retirement savings. Another key to a financially happy retirement? Reduce as much of your consumer debt as possible. You do not want to take credit card debt with you into your retirement years. Make sure, then, to do everything you can to pay off your high-interest-rate credit cards before you leave the workforce. Working longer is another strategy. If you can work past your full retirement age — whether that age is 66 or 67 — you will have more time to pay off debts and sock away savings. You will also boost the size of your monthly Social Security benefit. The longer you work — until the age of 70 — the more significant your monthly benefit will be. You might also choose to take on a part-time job after you retire. This extra income can help you cover necessary expenses and avoid dipping into your savings. Finally, you might have to adjust your expectations for your retirement years. You might not be able to take a cruise each year. You might not be able to help pay for your grandchildren’s college education. Remember, your priority during your retirement is to make sure you have enough money to last until your death. Only by focusing on your finances will you meet this goal.

Have You Saved Enough for Retirement?

View Resource Have You Saved Enough for Retirement?
Most people preparing for their first baby are shocked and even dismayed to learn just how high childcare costs can be. According to Care.com’s 2022 Cost of Care survey, weekly childcare rates for the care of a single child range from $694 for a nanny down to $221 for a family care center. In between, parents can expect to pay $261 for after-school care and $226 for a child care center.

Analyzing Your Needs

Costs for childcare will vary significantly across the country. Areas that feature a higher cost of living will also often have higher prices for childcare. The reverse is often true. The fact remains that childcare costs are significant expenses for families seeking quality care for their children while at work. Families with more than one child feel the pinch a little harder, especially if both children are under the age of four. That can be one of the most frustrating aspects of being a parent. You want the best life possible for your child and understand that often requires two incomes to provide. However, you want your child to have the best possible care as well. That takes money, too. Explore the costs of daycares in the area combined with the services they provide to the families they serve. Decide which facilities meet your needs and manage to address your concerns for your child’s safety and quality of care. Then, find the price that meets your needs best and does not add to other monthly budgets or commuting expenses.

FSAs and Tax Credits

Flexible spending accounts, FSAs, like a dependent care account, allow a single parent to set aside $3,050 tax-free each year to pay for childcare or $6,100 for a married couple. While it will not cover all the costs, by any stretch, of childcare for the year, it can help ease the sting. Additionally, child tax credits allow you to deduct up to $2,000 per year per child – up to $4,000 per family for childcare expenses. One thing you should note, though, is that while you can use both the FSA and a tax credit, FSA funds are applied first and count toward the tax credit.

Making it More Affordable

While we all recognize that nature often has a way of bringing us plenty of surprises, the best first step is to plan the growth of your family. Have childcare costs in mind well ahead of getting your new bundle of joy into the world. That is especially the case when considering second or third children. Some things you can do that will help with these expenses include: Steps like these can go a long way toward helping you manage the costs of raising your child in those first crucial years.

Getting More Mileage from Your Child Care Dollars

Small steps like these can yield significant results for your childcare budget and your efforts to manage childcare expenses.

Managing Your Child Care Expenses

View Resource Managing Your Child Care Expenses
Identity theft remains a serious issue in the United States. How serious? According to the Identity Theft Resource Center, 166 million records were exposed so far to identity theft in 2022, arising from over 1,291 total data breaches. The data breach analysis reports 474 compromises for Q3 2022. The financial services sector accounted for 15 percent of data breaches, healthcare and hospitality were 21.4 percent, the government had 4 percent and education with 5 percent. The meaning? You have to be more careful than ever to prevent a criminal from stealing your identity and impacting your daily life and finances. Fortunately, there are steps that you can take to lessen your odds of becoming a victim of this crime. Moreover, some of the steps require little more than common sense.

Reducing the Chance of Identity Theft

National credit bureau TransUnion, for example, recommends that you only carry essential personal documents with you. Leave extra credit cards, birth certificates, passports, and Social Security cards at home unless you need them. This way, if you get physically robbed, your assailant will not have as much personal information to use against you. TransUnion also recommends that you be careful when throwing away documents. The credit bureau recommends shredding receipts, credit card offers, bank statements, and returned checks before tossing them in your garbage or recycling bin. Thieves are not above pawing through your garbage to uncover your personal information. The Federal Trade Commission adds that you should refrain from receiving new personal checks from your bank through the mail. Instead, try picking them up at the bank so that identity thieves have one less opportunity to acquire your personal information. One way to give identity thieves less personal information is to opt-out of prescreened credit, and insurance offers that come in the mail. For example, you can log onto OptOutPreScreen.com to prevent financial companies from sending credit cards or insurance offers to your mailbox. Through this site, recommended by the Federal Trade Commission, you can opt-out of receiving these offers for five years or permanently. Eliminating these offers from your mailbox means that information thieves will not be able to use them to acquire your personal information.

Avoiding Scams

Equifax, a national credit bureau, warns consumers to be careful when giving out information online or through the phone. As the credit bureau says, many scammers will try to pry personal data out of consumers by convincing them they are representatives of their banks, phone company or credit card providers. The scam is simple, with identity thieves calling or emailing to say that consumers will lose access to a vital account if they do not confirm necessary information. Please do not fall for it. As Equifax states, your credit card company, utility, or bank will never ask you to provide passwords or your Social Security Number by phone or email. If you are unsure that you are speaking to a legitimate representative of your bank, utility, or credit card provider, ask them to send you a request by mail. An excellent way to protect yourself is to regularly track your bank and credit card accounts. Study your bank statements for any questionable withdrawals or transactions. Look at your credit card bills when they arrive to ensure that there aren’t any unauthorized purchases. Scammers rely on the fact that many victims fail to study financial statements when they come. Don’t fall into this trap. It would also help to track when your credit card statements regularly arrive. If your statement is late, contact your credit card provider. A thief may have stolen the information to take your data. Of course, signing up for paperless statements could solve this problem.

Securing Your Information

Today’s identity thieves have become proficient at using a computer to steal consumers’ personal information. Their computer savvy means that you have to be especially careful when online. CNET says that protecting yourself online starts with creating strong passwords that are difficult for thieves to hack. To do this, make sure to create passwords that include text, numbers, and symbols. Also, make sure that your passwords are long. The longer and more complex your passwords, the more challenging they will crack hackers. Unfortunately, many will merely move on to more accessible victims. Make sure, though, that you do not use the same password for all of your online sites. Once a hacker cracks one password, you can be sure that this criminal will not hesitate to try it out on many other financial websites you visit. CNET also recommends that you refrain from clicking on the attachments in strange email messages, even if these messages appear to be coming from a friend or co-worker. You never know if your friend has been a hacking victim as well.

Protect Yourself from Identity Theft

View Resource Protect Yourself from Identity Theft
Having a strong password is vital to your cyber security. Passwords are most secure when they combine letters, numbers, and symbols; some sites even require you to use passwords with a minimum number of characters and combinations that include upper and lower case letters, numbers, and special characters. Specific passwords that are just words, like “password,” for example, make it much easier for hackers to break into your account than if your password was something like “T9&vH*!2”. Along with choosing a strong password, it is crucial to have a different password for each site/username. If your passwords are all the same and a hacker breaks into your social media account, for example, they will have a much easier time breaking into your other accounts, like your email or online bank account. However, the problem with having several long, complex passwords is that they are hard to keep track of, and you may be unable to get into your online site or account because you have forgotten or misremembered a password. Luckily, password managers can solve the headache of trying to remember every password or the trouble of locating that scrap of paper with all the passwords you squirreled away in your junk drawer.

What is a Password Manager?

A password manager is a program or service, sometimes referred to as a password vault, holding all of your passwords in an encrypted digital locker on your computer or cloud. For example, a password manager could keep login information, such as usernames and passwords, for your social media accounts, email, work or school accounts, and more. Using a password manager allows you to create long, complex passwords without worrying about how you’ll remember each one.

Are Password Managers Secure?

Most cyber security specialists agree that password managers are the safest way to store your passwords. Despite this, Security.org states in their 2022 Password Manager report that 1 in 3 Americans use password managers. As mentioned, password managers allow you to choose solid passwords because you don’t have to worry about remembering them with a password manager. In addition, password managers are highly secure because they are encrypted using industry-standard encryption, like Advanced Encryption Standard (AES). Many password manager programs provide site and password breach alerts, security questions and answers, and two-factor or multi-factor authentication—some even facial and fingerprint recognition. AES 256-bit is a standard cipher (i.e., system for encrypting and deciphering data) used by many password manager services. It is so secure that even the US military uses it. It would take many decades to break this cipher so that a forceful cyber attack would have almost a zero percent chance of success.

Advantages and Disadvantages

Below are some general pros and cons of password managers.

Advantages to Using a Password Manager:

Disadvantages to Using a Password Manager:

Takeaway

Password managers are a very secure way to protect your passwords and are much easier and safer than remembering or keeping track of all your passwords without a manager. Also, using a password manager allows you to create and keep track of more complex passwords that you’d otherwise have trouble remembering. However, if you are using a password manager, use multi-factor authentication so your password manager is more secure and all your passwords are safe. Just make sure you don’t forget your password to access the password manager itself!

How to Use a Password Manager

View Resource How to Use a Password Manager
Most people do not want to start their marriage off with unnecessary debt. Yet, in 2022 in the U.S., the average wedding cost was $27,000, according to The Wedding Report. If you’re thinking of going on a honeymoon, you’ll probably spend even more than the average amount. $27,000 is a significant amount of money and can alternatively go towards a downpayment on a new home, an emergency fund, money for retirement, or even a few vacations in the future. Because the cost of a wedding can be so high, you’ll want to consider your budget and how much you want to spend. Comparing your and your partner’s special day with the extravagant weddings of friends or relatives isn’t necessary or helpful. Instead, it is best to figure out what’s within your means and plan accordingly. Developing a budget and planning around it will help reduce any unnecessary expenses, help save money, and ultimately, keep your financial stress to a minimum.

Building a Wedding Budget

To start determining the cost of your wedding, try making a list of your expenses– everything from the venue to catering to music and entertainment. When building your budget, it is best to consider the number of people you plan on inviting. For example, smaller weddings mean a smaller venue and less money to spend on food and drinks. On the other hand, larger weddings will require a larger budget. Putting a limit on your budget will make the process easier. Once you’ve researched venues, food expenses, decor, and whatever else you need, add up your totals and compare them to the limit. If you exceed your limit, try to see if you can cut back on some expenses. For example, you don’t want to sacrifice the size of your wedding; however, you can decide to have your ceremony on a less expensive date. If you still have difficulties funding the wedding, consider asking for help. Your parents, friends, and family members may be able to help you with the cost of the wedding.

Establishing Goals

You always want to try and be on the same page as your partner and have similar expectations regarding the wedding. Effectively communicating will help make your first major financial decision together go smoothly. Money can add pressure to a relationship, so starting your marriage without financial burdens will help relieve stress. When building your wedding budget, ensure you and your partner communicate your goals. Establishing this foundation will make it easier when making decisions regarding wedding expenses. For example, suppose you’re someone who enjoys international travel every year. However, having a more expensive wedding may deter that goal by potentially draining your savings and leaving you and your partner in debt. Effectively communicating with your partner regarding both of your dreams will help your decision-making process regarding your wedding expenses.

Understanding Needs and Wants

Understanding each other’s needs and wants will help you decide on your wedding. For example, if you and your partner agree on having a larger wedding, you can go for it. Once you start making these decisions, moving on to the next should be easier. Assigning value to how much you want or need something may help. For example, you may want to reconsider music and entertainment to afford the larger wedding. Instead of paying for a band, you could ask a friend to DJ the event for you. Try making a wedding playlist and having your friends and family members add songs.

Takeaway

Budgeting is crucial for planning a wedding, and having excess debt is not an ideal way to begin your marriage. Developing and sticking to a budget based on open conversations between you and your partner will help ensure less stress. In addition, having a realistic budget will ensure that you and your partner’s marriage won’t start with any additional financial burdens.

Budgeting For Your Big Day

View Resource Budgeting For Your Big Day
As the pandemic continues, unemployment rates have begun to decrease. According to the Bureau of Labor, as of November 2022, the unemployment rate was at 3.7 percent. So, if you are back to work after being unemployed for some time due to COVID-19, you may feel like you see tiny rays of light at the end of a very long tunnel. Before you give in to the excitement of returning to work, there are a few details you need to handle first. These are a few of the things you’ll want to do as you return to the workplace after a prolonged unemployment period.

Getting Off Unemployment

If you were among the millions of Americans receiving unemployment compensation while unemployed, now is the time to notify your state authority that you no longer require the assistance. Each state has different policies and procedures to go through when returning to work. The key is getting the right information from your state agency. You do not want to find yourself facing penalties, fees, and fines if you receive additional payments beyond what is necessary.

Getting Back into a Daily Routine

You have been away from the workplace for quite some time. You might be returning to a familiar office space (working for the same organization, for instance) or working somewhere completely new and different. In either case, your office landscape may look completely different due to COVID-19 precautions all employers are taking. After all, it is best for your employer not to lose an entire workforce for weeks at a time to pandemic-related illnesses and quarantines. Getting back into a daily routine often begins before you even get in your car to go to work. Chances are you have a few days or even weeks to prepare. Creating habits like this ahead of your return to work helps you ease into the transition without being overwhelmed by the first few days. You should also expect that others may not ease into the transition as smoothly, so bring an extra helping of patience with you when you enter your office.

Dealing with Stress at Work

Now is a time in our history when everyone is stressed. As you re-enter the workforce, expect stress levels to be high all around. That means you must learn to deal with and manage your own stress at work and how to respond to and work around the stress others experience. People are worried about COVID-19. There’s no way around it. Knowledge for managing the condition can be fleeting as the rules seem to keep changing. Some people do not like wearing masks. It can make them feel stressed and unable to focus on the tasks at hand. People are worried about how their children are faring, as they return to school in many cases, or remaining at home with their partners. Coping with stress is essential. These steps can help. Little things can make a huge difference in stress levels. See if you can turn things around for yourself and others. Do not add to the stress levels of the people around you.

Takeaway

Whether you are facing your return to work with a sense of excitement or dread, doing these things first can ease the transition much more effectively. May your return to work go as smoothly as possible and provide some semblance of a return to normalcy.

Employed Again? Do These Things First

View Resource Employed Again? Do These Things First
Technology and online security see continuous enhancements each year, but unfortunately, not those upgrades have not been enough to protect databases from being breached by hackers. As a result, identity theft remains a serious issue in the United States. How serious? According to the Identity Theft Resource Center, more than 166 million records were exposed to identity theft in 2022, arising from over 1,291 total data breaches. The data breach analysis reports 474 compromises for Q3 2022. The financial services sector accounted for 15 percent of data breaches, healthcare and hospitality were 21.4 percent, the government had 4 percent and education with 5 percent.

How to Know if Your Data Has Been Compromised

In most cases, a company will notify you via email or postal mail after discovering a data breach. They will likely tell you the stolen information, such as your name, email address, username, password, mailing address, Social Security number, and financial account numbers. Another way you may discover your data was in a breach is if you notice fraudulent activity on your accounts. For example, you may see a credit or debit card charge you did not make, or you may get a phone call or piece of mail about an account you did not open. The thief may have obtained your information through a data breach where the company has failed to notify you or where the breach has gone unnoticed.

Steps to Take to Protect Your Identity After a Data Breach

  1. Change your password if that was one of the pieces of information involved in the data breach. Also, if you use the same or a similar password for other things, change those passwords as well.

  2. Sign up for the free credit monitoring service offered by the breached company, if applicable. This service will likely check your credit report regularly and notify you immediately regarding any new information that appears. However, do not let the credit monitoring service give you a false sense of security. You should still take other steps to protect yourself and your identity.

  3. Place a fraud alert on your credit report by contacting one of the three credit bureaus: Equifax, Experian, or TransUnion. This alert will automatically transfer to the other two bureaus as well. When there is an alert on your credit report, creditors are supposed to contact you directly before issuing credit in your name.

  4. Review your credit reports for unusual activity. In particular, focus on the section that lists credit inquiries initiated by you. If you see something here that you do not recognize, this can indicate that someone has attempted to apply for credit using your name and Social Security number. Also, look at the section listing active accounts. If there is an account there that you did not open, contact the financial institution that manages the account and the credit bureau that provided the report to tell them it is fraudulent.

  5. Consider issuing a security freeze on your credit reports if you found evidence that someone is actively trying to open accounts using your information. The security freeze prevents new accounts from being opened unless you lift the freeze for a specific financial institution and a specific time frame.

  6. Protect existing accounts by monitoring your monthly account statements and checking all activity to ensure you initiated it. Monitoring your account is especially important if you know your credit card number, debit card number, or bank account number was compromised. If you notice any unusual activity on your statements, notify the financial institution that manages the account immediately. They may issue a new account number for you.

  7. Be vigilant about requests for personal information. Do not give your personal information if you receive a call or email from someone who claims to be with one of your financial institutions. Instead, call your financial institution directly through the number listed on your account statements or by typing in their website address. You should only reveal personal information if you have initiated the contact and are sure you are not talking to someone trying to defraud you.

If You’re a Victim of a Data Breach

View Resource If You’re a Victim of a Data Breach