Protecting Your Child's Credit

As adults, we know to protect our social security number (SSN) with our lives, but are you watching your child's SSN?

Kids make attractive targets for identity thieves because they have no previous credit history. Moreover, the crime could go undetected for years because parents don't typically check to see whether their children have credit records.

Credit issuers often do not verify the age of the applicant. The information on the application is taken at face value, especially when submitted over the phone or online.

Credit reporting agencies and the Social Security Administration don't share information. An applicant's age becomes "official" in the eyes of the credit reporting agencies when it is reported on the first credit application. Credit agencies believe the individual's age as indicated on the credit application is accurate until a dispute is filed and upheld.

Often your child's school, physician's office, daycare center, or sport's team may request your child's SSN. Always ask why it is needed, how it will be used, and how it will be protected. Refuse to give it unless absolutely necessary.

For a child, the damage caused by identity theft can be devastating because of the time that could pass before it is discovered. Frequently, as noted above, identity theft is not discovered until the child applies for a job or a driver's license many years later.

How can you protect your child's credit?

  • Never carry your child's social security card (or SSN written on a piece of paper) in your wallet or purse.
  • Educate your children about the importance of not sharing passwords, PINs, bank account information, house alarm codes, or any other personal data.
  • Routinely run a credit report on your child for the presence of a credit file. If a credit file is not found, that's good news. An existing credit report may indicate a problem.
  • Guard online social networking sites. These are attractive to thieves who can use them to coax information out of teens.
  • Be sure your child's bank account does not have overdraft protection and that it is only a savings account.
  • Teach your child the importance of changing passwords regularly and not giving away personal information on a website without your prior approval.
  • Watch for mail arriving at your home in your child's name. One of the first red flags is a preapproved credit card offer. This may reveal that your child has an established credit record.
  • If your child is old enough to apply for a job, be sure the employer is legitimate—not a job off Craigslist.

Our job as parents is to protect our children, and this includes protecting their credit. Check regularly to determine whether your child has a credit report so you can catch the problem early and save yourself—and your child—time and money.