Cyber crime is a danger to every single one of us who does anything online.

No matter if you’re online banking, or just keeping in touch with friends on Facebook, hackers can get a hold of your data and use it for their own gain.

Identity theft is one of the most frequent cyber crimes. Here, cybercriminals use your name, social security number, or financial information to make a quick buck. For you, this can spell disaster.

Here are the five worst impacts on your life – and how to avoid them.

Worst Effects of Identity Theft

1 – Inflated Credit Card Bills

A major consequence of identity theft is direct financial damage. For instance, a cybercriminal has your credit card details and is now making purchases with them.

Unless you act fast, this could quickly cost you thousands of dollars.

Check your monthly credit card statements carefully. If you see a charge you don’t recognize, immediately contact your credit card company and flag the transaction as potentially fraudulent.

2 – Bad Credit Ratings

You want to take out a loan for a new house, tuition fees, or refinance your car. And are denied due to bad credit, even though you haven’t done anything wrong.

This is likely the result of identity theft.

Cybercriminals will often use your data for shady financial transactions. For instance, they can open an account in your name, accumulate debt there, and tank your credit rating.

To prevent identity theft from harming your credit, check your credit scores regularly. You can request one free credit report per year. If you want to get more frequent updates, consider subscribing to an identity theft monitoring service.

3 – Criminal Charges

One of the worst effects of identity theft is that it might get you in trouble with the law.

Traffic tickets are the least of them. In the worst-case scenario, police might show up on your doorstep with a warrant for your arrest.

Unfortunately, there is relatively little you can do to prevent this, except to report any suspicion of identity theft immediately.

If you see any warning signs, file a report with your local police station and the FTC. That way, you’ll be able to prove that your identity was compromised if you do get in legal trouble later on.

4 – Insurance Trouble

One of the most common types of identity theft is medical identity theft. That means that criminals use your SSN and insurance information to cover medication and medical procedures that you never need.

This can get you into major trouble with your insurance company.

To avoid this type of identity theft, check in with your insurer as soon as you notice any irregularities. Furthermore, if you see any other warning signs of identity theft, alert your insurance company to put them on their guard.

5 – Reputational Damage

Finally, one of the most severe consequences of identity theft is reputational damage: People lose trust in you because your identity was used to harm them.

This could be the case, for example, if cybercriminals hijack your social media profiles or email account to send out malware.

The best you can do is minimize this damage. As soon as you find yourself unable to log into one of your accounts, get a message out to all of your contacts via an alternative channel to alert them.

The Bottom Line

Identity theft can have severe financial, legal, and reputational consequences. To protect yourself and prevent identity theft, you need to stay vigilant and watch out for red flags – and to step up your everyday cybersecurity.