There’s no more tempting target for identity thieves than your child’s financial identity. For one thing, it’s a clean slate. For another, it can be a long time before your child tries to get credit which means years during which thieves can create havoc in your child’s name without anyone noticing.

No one is too young to become a victim of identity theft. If you’re old enough to have a Social Security Number, you’re old enough for identity thieves to assume your identity. The youngest reported case: a one-month-old.

Identity theft impacts a child in a variety of ways, particularly once he or she becomes a teenager. A college-bound victim, for example, could be denied scholarships and financial aid. A potential employer could end up denying a candidate if the routine background credit check reveals unpaid bills and a loan default. A stolen identity could lead to a motor vehicle record being tied to a criminal’s name and could prevent a young adult from being able to rent an apartment or open a utility account. It could even lead to medical records that are muddled with incorrect information.

The only way you would know if your child is a victim is after the fact: You receive collection calls or bills for products or services you didn’t receive; you get a notice from the IRS saying that your child didn’t pay income taxes; or you’re turned down for government benefits because the benefits are being paid to another account using your child’s Social Security Number. Or you might check your child’s credit report and discover activity when, in fact, the file should be blank.

Prevention Equals Protection

The most effective way to protect your child and prevent identity theft is to freeze his or her credit file, says Chi Chi Wu, staff attorney at the National Consumer Law Center. Once someone’s credit is frozen, no one can open a new account in that person's name until that individual—or a parent or guardian—applies to have the file “thawed.” “It’s the single most effective step you can take to prevent identity theft,” Wu says.  

For now, there's no federal law regarding credit freezes for minors. The Protect Children from Identity Theft Act, introduced in the House of Representatives in March 2015, would give parents and guardians the ability to create a protected, frozen credit file for their children. However, GovTrack gives it a two percent chance of being enacted by the current Congress. “If parents live in a state that doesn’t provide for this, they might want to contact their Congressional representative," Wu suggests.

Instead, each state has its own policy to prevent identity theft. There are currently 23 states that allow parents and guardians to place a security freeze on a minor’s credit report. Those states include: Arizona, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Michigan, Montana, Nebraska, New York, North Carolina, Oregon, South Carolina, Tennessee, Texas, Utah, Virginia, and Wisconsin. Many of these states will only allow parents or guardians to request a freeze if the child is 16 years old or younger; Connecticut and Illinois allow if the minor is 18 years old or younger.

Similarly, policies and the price to freeze a child’s credit differ among the major credit reporting agencies. Equifax offers a free service that allows parents to create a credit report for a minor and freeze it regardless of the state requirement. Other credit bureaus won’t create a file for a minor unless mandated by state law, and may charge a fee ranging from $3 to $10 to implement a minor’s freeze.  

Don’t wait until your child’s credit is compromised to implement a protective freeze and prevent identity theft. “Do it when your child gets a Social Security number,” Wu advises.