• Questions After the Equifax Data Breach

    Consumers may be at risk for many years.

     

    Provided by MidAmerica Financial Resources

     

    How long should you worry about identity theft in the wake of the Equifax hack? The correct answer might turn out to be “as long as you live.” If your personal data was copied in this cybercrime, you should at least scrutinize your credit, bank, and investment account statements in the near term. You may have to keep up that vigilance for years to come.

     

    Cybercrooks are sophisticated in their assessment of consumer habits and consumer memories. They know that eventually, many Americans will forget about the severity and depth of this crime – and that could be the right time to strike. All those stolen Social Security and credit card numbers may be exploited in the 2020s rather than today. Or, perhaps these criminals will just wait until Equifax’s offer of free credit monitoring for consumers expires.

      

    Equifax actually had its data breached twice this year. On September 18, Equifax said that their databases had been entered in March, nearly five months before the well-publicized, late-July violation. Its spring security effort to prevent another hack failed. Bloomberg has reported that the same hackers may be responsible for both invasions.2

      

    Should you accept Equifax’s offer to try and protect your credit? Many consumers have, but with reservations. Some credit monitoring is better than none, but those who signed up for Equifax's TrustedID Premier protection agreed to some troubling fine print. By enrolling in the program, they may have waived their right to join any class action lawsuits against Equifax. Equifax claims this arbitration clause does not apply to consumers who sought protection in response to the hack, but lawyers are not so sure.1

        

    Should you freeze your credit? Some analysts recommend this move. You can request all three major credit agencies (Equifax, Experian, TransUnion) to do this for you. Freezing your credit accounts has no effect on your credit score. It stops a credit agency from giving your personal information to a creditor, which should lower your risk for identity theft. The only hassle here is that if you want to buy a home, rent an apartment, or get a new credit card, you will have to pay a fee to each of the three firms to unfreeze your credit.1

     

    Three other steps may improve your level of protection. Change your account passwords; this simple measure could really strengthen your defenses. Choose two-factor authentication when it is offered to you – this is when an account requires not just a password, but a second code necessary for access, which is sent in a text message to the accountholder’s mobile device. You can also ask for fraud alerts to be placed on your credit reports, but you must keep renewing them every 90 days.1

      

    What other tools can help watch over your statements? If your bank, credit union, or credit card issuer does not offer identity theft protection and credit monitoring, consider free apps such as Credit Karma, Credit Sesame, and Clarity Money. Apart from simply protecting your credit and bank accounts, programs like EverSafe, Identity Guard, and LifeLock have the capability to scan the “dark web” where personal information is sold in addition to monitoring your credit reports. (You may be able to take advantage of a free, 30-day trial.)1

     

    When a pillar of worldwide credit reporting has its data stolen twice in five months, the trust of the public is shaken. The lesson for the consumer, as depressing as it may be, is not to be too trusting of the online avenues and vaults through which personal information passes.

       

    MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@natplan.com www.mid-america.us

     

    This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

     

    Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser.
    MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to NPC.

        

    Citations.

    1 - time.com/money/4947784/7-questions-you-must-keep-asking-about-the-equifax-hack/ [9/20/17]

    2 - bloomberg.com/news/articles/2017-09-18/equifax-is-said-to-suffer-a-hack-earlier-than-the-date-disclosed [9/18/17]

     

  • Millennials, Do Not Imitate Your Parents

    They invested heavily in what was “hot” and got burned.

     

    Provided by MidAmerica Financial Resources

     

    A new generation of investors is coming to the forefront: your generation. Millennials have witnessed a fantastic bull market, one of the longest on record. Any given week, scary headlines may generate some volatility, but the bulls just keep on running.

     

    It is easy to be lulled into a false sense of security in this market climate. Bearish arguments can be effortlessly dismissed. Innovation, consumer-friendly technologies, and new social media platforms are turning heads and sending share prices higher. TD Ameritrade says that the five most-owned stocks among its millennial accountholders are Apple, Netflix, Amazon, Tesla, and Facebook. Snap and Twitter are also on the radar. Trading shares via phone is routine. So what if these stocks pay no dividends? (Currently, only Apple does.) These companies seem invincible.1

       

    Twenty years ago, another generation of investors worshipped tech stocks. In the Web 1.0 era, baby boomers and Gen Xers salivated over the potential of Yahoo, Cisco, Lycos, Broadcast.com, E*TRADE, GeoCities, and other emerging tech firms. They were all so hot. Then came the dot-com crash of 2000.

     

    Ever hear of a company called CMGI? It owned the search engine AltaVista. It sold GeoCities to Yahoo. Between the end of 1994 and the end of 1999, its shares rose more than 4,900%. They peaked at $163.50 at the start of 2000. By August 2002, CMGI shares were trading for $0.44.2,3

     

    How about Pets.com? Remember its slogan, “Because pets can’t drive?” Buy pet food online, and have it delivered? That was a revolutionary e-commerce idea, but it may have been ahead of its time. Pets.com went public in February 2000 at $11 a share (an IPO complemented by a Super Bowl commercial). It shut down nine months later, with its shares down at $0.22.4

     

    What is the lesson here? Diversify your holdings. Back in 2000, too many young investors fell in love with the tech sector; their portfolios were heavy with tech shares. The Nasdaq Composite hit a historic peak of 5,048 on March 10, 2000; on October 9, 2002, it was 78% lower at 1,114. Other sectors are not impervious to such hard falls. Between May 2007 and March 2009, the S&P 500’s financials sector dropped more than 84%. If you think stocks may never slide that much again, keep in mind that the Nasdaq and S&P were at or near record highs when these shocking downturns started, just like today. Diversification could provide some degree of insulation for your portfolio when, not if, the market drops.5

     

    MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@natplan.com www.mid-america.us

     

    This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

     

    Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser.
    MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to NPC.

     

    Citations.

    1 - cnbc.com/2017/07/10/millennials-are-making-long-term-investments-in-big-tech-stocks.html [7/10/17]

    2 - nytimes.com/2000/12/10/business/cmgi-can-defy-gravity-only-so-long.html [12/10/00]

    3 - bizjournals.com/boston/blog/techflash/2014/06/waltham-company-moduslink-still-paying-for-cmgis.html [6/13/14]

    4 - nytimes.com/2000/11/08/business/technology-petscom-sock-puppet-s-home-will-close.html [11/8/00]

    5 - seekingalpha.com/article/4082567-danger-another-tech-stock-bubble [6/20/17]