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“Be very careful, then, how you live—not as unwise but as wise.” (Ephesians 5:15, NIV84)

That is how the good steward ought to operate with what has been entrusted to him or her!

In the realm of biblical stewardship, the notion of safeguarding God’s resources and assets that He put into our care, extends far beyond the tangible. It encompasses the responsibility to protect our personal financial well-being along with honoring God with the proper management of all entrusted to us. 

In today’s world, where the threat of digital theft along with identity theft looms large, the concept of freezing one’s credit takes on profound significance. As stewards of God’s provisions, it’s imperative to employ solid practical measures to safeguard one’s financial integrity. 

Understanding how and when to freeze your credit is not merely a matter of financial prudence but it is also an extended reflection of our commitment to wise and faithful stewardship. In this episode, we will explore the underlying practice of credit freezing, along  with the tools necessary to protect our financial resources to keep us in alignment with honoring God with our stewardship.

 

What Does it Mean to “Freeze” Your Credit?

Freezing your credit is a proactive measure you can take to restrict access to your credit report, making it more difficult for identity thieves to open new accounts or lines of credit in your name. When you freeze your credit, the credit bureaus (Equifax, Experian, and TransUnion) place a “freeze” or “lock” on your credit file, preventing creditors and lenders from accessing your credit report to review your credit history when you apply for new credit.

Freezing your credit is a measure that many ought to take, yet they do not!  It is done to protect your personal and financial information from unauthorized access in this crazy digital world we live in today, and we do this particularly in response to data breaches or identity theft concerns. First, let’s take a look at the:



Benefits of Freezing your Credit

  1. Prevents Unauthorized Access: One of the primary benefits of freezing your credit is that it prevents identity thieves from opening new accounts or lines of credit in your name. When your credit is frozen, creditors and lenders typically cannot access your credit report, making it much more difficult for fraudsters to use your personal information to apply for credit cards, loans, or other financial products without your knowledge.
    • Adds Security Layer: Freezing your credit adds an extra layer of security to your financial information. It serves as a proactive measure…a firewall, to safeguard your credit report and reduce the risk of unauthorized access to your sensitive personal data.
    • Reduces Identity Theft Risk: By limiting access to your credit report, freezing your credit helps minimize the risk of identity theft. Identity thieves often rely on stolen personal information to open fraudulent accounts, and a credit freeze can thwart their attempts to exploit your financial identity.  When this is done, the fraudsters, if challenged, will most likely drop your case and move on to another one that is easier to access.
  2. Gives You Control & Peace of Mind: Freezing your credit gives you greater control over who can access your credit report and under what circumstances. It puts you in control!  You have the ability to temporarily lift the freeze when you need to apply for new credit or permanently remove it if you no longer require the added protection.  In today’s digital, web and app driven world, the changes that you make…and would like to make quickly, could be done because of the benefits of today’s technology!
  3. No Impact on Existing Accounts: It’s important to note that freezing your credit does not affect existing accounts you have open, such as credit cards or loans. You can continue to use these accounts as usual, and freezing your credit won’t interfere with your ability to manage them.  The only way you would have a problem is if you would like to increase a line of credit.  If that would be the case, then a temporary lift on the freeze would have to take place until the desired credit line is available.
  4. No Impact on Credit Score: This is an important note for all to understand.  Freezing your credit does not impact your credit score. It merely restricts access to your credit report and prevents new accounts from being opened without your consent. Your credit score will remain unaffected by the freeze.
  5. Cost free. There is typically no cost to freezing your credit. We have done this many times through the years, and have never been charged to initiate the credit freeze.

 

Drawbacks of Freezing your Credit

  1. Not 100% guaranteed. While effective, a credit freeze is not a guarantee of being a fool proof way of protecting your credit.
    • Also, it is important to note that there is a difference between freezing your credit and protecting your identity.  That will be a topic of discussion in another episode some day.
  2. Individual agency contact. Sadly, if you want to freeze your credit, you will have to contact all three major credit reporting agencies to freeze your credit: Equifax, Experian, and TransUnion. You can do this by submitting a request online, by phone, or by mail.  To lift the freeze on your credit, again you will have to contact each agency accordingly.
  3. You need to plan ahead.  Putting the freeze on and off usually is not instantaneous.  It may take hours or even days for the lock (or lift) to be enacted.  Plan ahead, if you need to unlock any locked down credit that you have.

 

How to Freeze Your Credit:

  1. Contact Credit Bureaus: You’ll need to contact each of the three major credit bureaus individually to initiate a credit freeze. As stated earlier, the three bureaus are Equifax, Experian, and TransUnion. You can get their contact info online and/or download their apps to your smartphone.  You can request a credit freeze online, by phone, or by mail. Each bureau will provide instructions on how to proceed with the process.  It is not difficult, but it can take a little time to have it in full protection mode.
  2. Provide Information: When requesting a credit freeze, you’ll need to provide personal information such as your full name, address, date of birth, Social Security number, and possibly other identifying information that only you would know about yourself. This helps the credit bureau verify your identity and implement the freeze.  Don’t be impatient, for you really do want them to make sure they get it right…both for the freeze and the unfreeze!
  3. Receive Confirmation: Once you’ve initiated the credit freeze with each credit bureau, you’ll typically receive a confirmation along with a unique PIN or password. This information is important because you’ll need it to temporarily lift or permanently remove the freeze in the future.  
  4. Keep Records: It’s essential to keep records of your PINs or passwords in a safe place. You almost always will need this info to access your credit if you decide to lift the freeze or if you encounter any issues with your credit report, so tuck this info away in a VERY secure location, for you will need it again someday down the road!

When to Freeze Your Credit:

  • After a Data Breach: If you’ve been notified of a data breach that may have exposed your personal information, consider freezing your credit to prevent unauthorized accounts from being opened in your name.  This is a good and solid preventative measure.  Your data has been breached, but your credit has not been!  Protect it by locking it down for a season.
  • Preventative Measure: Even if you haven’t experienced a data breach or identity theft, some individuals opt to freeze their credit as a proactive measure to safeguard their personal and financial information. If you have the debt you need, and don’t plan on taking on any more, freezing your credit could be a very good idea. It may be a good idea to consider if you plan on traveling abroad.
  • Identity Theft Concerns: If you suspect or have experienced identity theft, freezing your credit can help prevent further unauthorized activity and protect your financial well-being.  If this is you, consider subscribing to an identity theft protection service like “LifeLock” or similar to give yourself an added layer of protection.

 

Important Considerations

  • Cost: As we stated earlier, placing a credit freeze is generally free, but you may incur fees for temporarily lifting or permanently removing the freeze. Check with each credit bureau for their specific policies. The credit bureaus have paid services, and if interested, look into them and see what they offer above and beyond the initial freeze.
  • Impact on Credit Applications: Keep in mind that a credit freeze can potentially delay or complicate the process of applying for new credit, loans, or financial services. If you plan to apply for credit in the near future, you may need to temporarily lift the freeze.  Plan ahead, think ahead and unfreeze accordingly.
  • Duration: A credit freeze remains in place until you choose to lift it temporarily or permanently. If you choose to lift it temporarily, you can specify a time frame during which the freeze will be lifted before automatically reinstating.
  • Monitor Your Credit: While a credit freeze can provide significant protection, it’s still important to regularly monitor your credit report for any suspicious activity. You can request free credit reports from each of the three major credit bureaus annually at AnnualCreditReport.com, and we highly advise you to get a copy each year, and review it.
  • Don’t forget your spouse!  Just because you freeze your credit, it does not mean that if you are married that your spouse’s credit is frozen also!  If you are married, it would be very good to go through the process and freeze your spouse’s credit also so that you have an even greater protection for your household.

Before deciding to freeze your credit, weigh the potential benefits against any inconvenience it may cause, especially if you anticipate needing to apply for credit in the near future (house purchase or securing another type of loan). If you have specific concerns or questions, consider consulting with a financial advisor or identity theft expert for personalized guidance.



Stewardship Application

As we navigate the complexities of financial stewardship in this ever-changing digital age, let us remember the wisdom found in Proverbs 27:12, which tells us, “The prudent see danger and take refuge, but the simple keep going and suffer for it.”

Just as Joseph stored grain during times of abundance to prepare for times of famine (Genesis 41), so too must we exercise foresight and prudence in safeguarding our resources against potential threats, especially digital threats today!  By freezing our credit when necessary, we demonstrate diligence and wisdom in protecting what God has entrusted to us. Let us heed the words of Matthew 10:16, where Jesus advises his disciples to be “wise as serpents and innocent as doves,” applying discernment and shrewdness in all areas of our stewardship. As we work toward safeguarding the assets that God has put into our care, may we continue to walk in faithful stewardship, honoring God with every aspect of our lives, including the management of His resources that are in our safekeeping.



 

Next Steps

 

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The topics discussed in this podcast are for general information only and are not intended to provide specific investment advice or recommendations.Investing and investment strategies involve risk including the potential loss of principal. Past performance is not a guarantee of future results.

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