One of the most important factors of being financially healthy is knowing what’s in your credit report. Just as important is knowing how to access this information and what the information means.

Check your credit report. Have you done that yet this year? Remember that under federal law you are entitled to a free credit report from each of the three national credit reporting companies one time each year. If you have not checked your own credit report in the past twelve months, please do it. Go to www.annualcreditreport.com, or call toll-free 877.322.8228 to request a form to order your report. There are other places you can get your credit report, but this one is free. The only cost to you is your time.

“But I’m so busy I just don’t have time to do that, even once a year. I’m sure my credit report is fine.” Here’s a question – how do you know? Your identity may have been compromised and some nefarious person you never met may be using your identity to run up thousands of dollars of debt using your name and Social Security number. It does happen, and it can happen to you. An annual review of your credit report will ensure that any debts listed for your identity are in fact yours.

When you review your credit report, consider what accounts are open as well. Frequently accounts that have been paid off for years are still showing, especially if they are revolving credit accounts, such as credit cards or department store accounts. Even if you pay off an account and it shows as a zero balance, if it is open it will add to your available credit – and too many credit lines can adversely affect your credit score. We recommend that if you are not using an account and have paid it off that you contact the company and close the account. Closing the account will remove that available balance from your report – and eliminate the possibility of someone gaining access to that account as well.

You can get your credit score at the same time you get your free annual credit report, but there is a charge for it. You may think your credit report is just fine, but how do you know? The time you will spend will be more than worth its weight in gold if you discover that someone is using your identity for fraudulent purposes. And if you find that all is well with your credit report, think of the peace of mind you will have!