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10 Ways to Keep Fraudsters From Stealing Your Identity

10 Ways to Keep Fraudsters From Stealing Your Identity

You’re opening your inbox at work when suddenly you get a message from an unknown company. It turns out to be an email from what seems to be a new online shopping store who’s offering great discounts.  On its home page it requires you to sign up asking for your name, credit card number, and password. 

Should you be alarmed? How willing are you to give your private information?

Identity theft is on the rise. The US Bureau of Justice Statistics estimated that there are 15 million American victims of credit card fraud every year. From 2007, malicious software and programs grew from 1 to 130 million in just a span of a few years. These software are also evolving rapidly from what used to be easily scanned and removed viruses, to sophisticated stealth programs that work to monitor computer keystrokes. Costing billions of dollars each year, it is considered one of the fastest growing crimes in America.

What is Identity Theft?

The term identity theft is defined as “the deliberate use of someone else’s identity, usually as a method to gain a financial advantage or obtain credit and other benefits in the other person’s name.”

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These criminals, also called hackers or fraudsters, obtain people’s personal information through various sophisticated and old fashioned methods of stealing — including skimming, phishing, dumpster diving, shoulder surfing, and remote thievery.

The rise of clever hackers with ingenious tech skills is a terrifying problem that could affect everyone’s internet and website security. All forms of devices — your home computers, laptops, and even mobile devices — are vulnerable to identity thieves. So how does one protect their digital presence?

1. Practice Email Safety

Beware of suspicious links and attachments in your email. Some thieves will send victims emails containing links that may appear to be from a legitimate source. However, these links are often directed to a fake site designed especially to collect sensitive data, such as people’s usernames and passwords. Usually, criminals send these emails during holiday seasons alongside promotional emails from other legitimate or popular websites.

2. Create Better Passwords 

How many passwords do you have for every account? If you’re only using one for everything, you might want to change some of them. Experts recommend having different passwords for every website you sign up for. For example, your email password should be different from your Facebook and your PayPal password. Securing your passwords ensures your safety from thieves who acquire information by simply hacking your email and then getting data from all your linked accounts.

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3. Invest in Good Anti-Spyware Programs

Arm your computers with good anti-virus software — and make sure that you update it regularly. Links from scams usually have viruses that can infect your computer and become gateways for hackers to control your device. When choosing a good anti-virus program, it’s always wise to avoid nefarious applications masquerading as free anti-virus software. For safety measures, always choose popular programs trusted by a lot of people.

4.  Be Wary of Phishing Scams

This form of scam is used by fraudsters to get your valuable details and hack your credit cards. Phishing is a way of acquiring personal information by fooling people to subscribing or signing up into a forged website designed to steal personal data. These scams often lure people by offering free services and discounts and sometimes by faking authority to get the person’s trust.

5. Avoid Public Wi-Fi

You might want to think twice before you connect to a public Wi-Fi.  Sometimes, cyber fraudsters will hack and use public Wi-Fi to access private data on their victim’s devices. They can do this easily by using a technique called sniffing that intercepts data packets and enables the user to see everything on a fellow free Wi-Fi user’s device. Sometimes they can also set up rogue accounts and disguise it as public connections for airport, libraries, and other crowded community spots.

6. Review Your Credit Cards

How often do you review your credit records? Once hackers have access to your credit accounts, they will steal small amounts (under 2$) so you won’t notice it at the beginning. During times when you shop more especially during the holiday seasons, hackers will increase the amount of money they’ll steal. Thus, it’s very important to always review your credit records and check your bank immediately if you see even minor suspicious spendings.

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7. Know Where You Shop

When shopping on phone, tablet or computers, make sure that you’re double checking the website you’re on. Hackers often clone shopping sites to do various phishing attacks. A good way to distinguish whether a site is secure or not is by looking at the lock symbol on the left side of the URL tab. It’s also better to shop on popular and trusted websites.

Do not ever reveal personal information to unverified sources over phone or the internet. People have reported many cases of getting phone calls from people claiming to be someone from the bank and asking for their account numbers and PIN. Immediately hang up if this happens and call the direct number of your bank company to ask if they are really associated with this number. This way you can be sure that you are speaking to a real representative and not an impersonator. Know who you are dealing with and be defensive whenever anyone contacts you asking for private identity or financial information.

8. Keep Physical Documents Safe

Invest in home safes. Safes are built for the purpose of keeping your documents and files safe from prying eyes with malicious intent. When throwing away documents that contain sensitive information, it’s best to shred the file to prevent it from getting in the wrong hands. Dumpster diving is a common method of stealing where criminals search the trash for items of use and value.

9. Be Careful of Shoulder Surfers

Shoulder surfers are people who keep watch over your cards whenever you make a transaction in an ATM bank or even online. These thieves will be cloaked as normal people, even wearing suits and looking respectable. They target people in every profession and in the most seemingly safe locations.

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They also use a lot of gadgets like credit card skimmers, tiny cameras, and may even use binoculars to look at your card details from afar. When using ATM, make it a point to shield your keypad to prevent anyone from seeing you when you punch your PIN. When in foreign countries or new places, use machines that are in public and well-lit areas.

10. Protect Your Identity Online

Identity theft protection services are becoming increasingly important. Many companies now offer services that will help you prevent identity theft. You can check out these expert reviews of identity theft protection services to know which services will suit your needs.

 Final Thoughts

Having your identity stolen is no laughing matter. This is an issue that needs to be addressed. The more people are aware of this practice, the more we can fight this crime. For now, the best thing we can do is to take a cautionary approach when giving personal information online or offline. Stay vigilant and protect your identity.

Featured photo credit: Sylwia Bartyzel via unsplash.com

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Published on December 13, 2018

How to Start a Company from Scratch (A Step-By-Step Guide)

How to Start a Company from Scratch (A Step-By-Step Guide)

If you’ve ever thought about starting and running your own business, you’re not alone. Being your own boss, having flexibility with your schedule and keeping more of the financial rewards that come with business ownership are all good reasons to own your own company.

But as you might expect, it’s not all vacations and fat bank accounts. According to the SBA, 2/3 of businesses survive at least 2 years and approximately 50% survive 5 years.[1] So why is the failure rate so high? At least for the businesses that fail early on, lack of, or poor planning can be a major factor.

So how to start a company?

Starting a business from scratch doesn’t have to be hard or complicated, but it does take planning and work. Here are the first and most important 9 steps to take when your are starting a company from scratch.

1. Do an Honest Evaluation of Yourself

Do you work better in a structured or unstructured environment? Does a daily routine reduce your anxiety? What kinds of things are you good at? Does public speaking or making presentations make you nervous? Are you good at accounting and numbers? Can you handle the rejections you’re bound to get when selling or cold calling?

These are all important questions to ask yourself, in fact it’s a good idea to get other peoples opinion about their perception of you in each of these situations.

Whatever the answers you come up with for your evaluation, remember that’s all it is, an evaluation of where you are now. Think of it as a way to identify both your areas of strength and weaknesses.

You maybe good at public speaking which can help when raising money, but bad at accounting which just means that you’ll need to find some kind of help with that area of the business.

2. Evaluate Your Idea

If your business idea involves a new product or service (or even an enhancement to an existing product or service), it needs to be evaluated. This is technically called market research.

There are firms that specialize in doing market research for new products, but if you are on a tight budget, you can do this yourself.

First, if you can build a prototype for people to use, touch and look at that’s the best option. If a prototype is not possible or it’s a service business, then offer a highly descriptive presentation of the business plan complete with it’s unique benefits and how it’s different from the competition.

Then listen! Remember that this is not about others liking your product, this is not your baby that they are talking about. You want honest market research that gives you the best chance for a successful business. Take notes, when someone tells you that they didn’t like a feature or some aspect of your idea tell them ‘Thank you”.

After several rounds of market research with different groups of people, you should see patterns emerging about things that they both liked and didn’t like. Use this information to tweak your product or service and do another round of market research.

Keep in mind that you’ll never come up with a universally loved product, your job is to produce a product or service that appeals to the broadest range of your target market.

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3. Make a Business Plan

I know, I know this isn’t the “fun” part of starting your own business, but it is an very important step in creating a successful business!

Basically, you can think of a business plan as an outline or blueprint of your business. A good business plan should have the following elements:

  • Executive Summary – This should lay out the businesses product or service and the problem that it solves for the consumer.
  • Market Evaluation – This should talk about the market you are serving. Is it an expanding market, and how does your product better fulfill the consumers in that market.
  • Market Strategies – How are you going to penetrate the market and sell your product.
  • Operational Plan – How will the company run from day to day? Who are the key employees and what are their specific rolls. Do your key players have specific goals set for them in advance?

A final word on making a business plan: while lying is never acceptable especially when you are using the business plan to raise money, it is acceptable to “put your best foot forward”.

Playing up the positives while minimizing the negatives is almost expected in a business plan.

Besides, banks as well as professional investors will both do a more in-depth analysis before investing any money into your idea.

4. Decide on a Business Structure

You have many options here, and discussing them with your accountant or financial adviser is really the only way to know what’s right for you. But just to give you a quick rundown of the types of business entities and their pros and cons we will briefly go through them:

Sole Proprietorship

This is a common way for small businesses to get started.

The pros being:

Relatively low costs to set up (usually a business license and sales tax license).Owners normally do not have to set up a special bank account, they are allowed to use their personal one. Any income earned can be offset by other losses (check with your state!). You as the sole proprietor have complete control over all decision making. 

Finally, sole proprietorship’s are relative easy to dissolve.

The cons of using a sole proprietorship include:

You as the sole proprietor can be held personally responsible for the debts and liabilities of the company. Some benefits, such as health insurance premiums, are not directly deductible from business income.

If you need to raise money, you are not allowed to sell an equity stake in the company. In that same vein, hiring key people maybe more difficult because you cannot offer them an equity stake in the company.

Partnership

A partnership is formed when two or more people decide to start a business. Although there is no legal requirement for any documentation to form a partnership, it is my advice that you never enter into a partnership without having a partnership agreement. (Remember, spending $1500 now can save you $150,000 in legal fees later!).

The pros of a partnership include:

Being relatively easy and inexpensive to start. Hiring key employees can be easier as you are allowed to give equity ownership to as many partners as you want.

For tax purposes, partnerships are relative simple as any income is treated as “pass through” meaning that each partner pays tax on their individual portion of the partnerships income (As of this writing, always check with your tax adviser).

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As far as the cons go:

It can be difficult for some general partnerships to raise capitol. Because it is a partnership, the actions of one of the partners can obligate the entire organisation. All profits must be shared according to the partnership agreement regardless of the amount of work done by any single partner.

Some employee benefits may not be able to be deducted on income tax returns.

Limited Liability Company (LLC)

This is a very popular business entity for small to medium sized businesses. The reason for this is the cost of set up is not prohibitive and there is a separation between the owners and the company.

The pros of an LLC include:

Limited liability for the partners, unlike sole proprietorship’s and partnerships where the owners are held responsible for all of the companies debts and liabilities, an LLC provides some protection against certain debts and liabilities that are solely the companies.

Simple taxation, just like the sole proprietorship and partnerships, income is considered “pass through” and is only taxed once on an individual level.

There is no limit on the number of shareholders in an LLC. An LLC requires fewer fillings and administrative requirements than a corporation.

Corporation

A corporation is much more complex and expensive to set up. And a corporation is legally considered an independent entity that is separate from its owners.

The pros of a corporation include:

Complete separation between the owners and the company. Because the corporation is considered its own legal entity, owners can not be held personally responsible for any debts or liabilities of the company.

A corporation can raise capital much easier just by selling more shares in the company.

Cons of corporations include:

Much higher administrative costs than any other business entity. Corporations generally have a higher tax rate. Dividends are not tax deductible for corporations. Income paid in dividends is taxed twice, once by the corporation and again by the shareholder.

Again, this is just a short summary of the pros and cons, always check with your tax adviser about what will work best in your situation.

5. Address Finances

Again, not one of the “Sexier” parts of starting your business from scratch, but very important nonetheless.

So, you’ve done your business plan and an estimate of your start up funding should be included. It should include the amount of funding you’ll need to get you through your first full year of operations.

Now, how do you get that money?

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Self Funding

If possible, self funding is the easiest. You won’t have to go to banks and investors with hat in hand, or give up ownership or control of your company. But as we know, this is not a reality for most people. But don’t worry, there are still plenty of options available.

Friends and Family

They can be a good source of funding your business if they can see and understand your vision.

Remember that business plan? Pass them out to everyone you know. Then follow up, be prepared to tell them the total amount of money you expect to raise, the minimum investment you are looking for and what you will give in return for the investment.

For example, you give a friend your business plan and follow up with him/her a few days later. You can explain that you have secured funding for $80,000 of the $100,000 you need. You are selling a 2% share in the company for every $2,000 investment. How many shares would he like?

And when he/she tells you no, thank him/her and ask if he/she can think of anyone off the top of his head who might be interested? Tell him/her you really appreciate his/her time and if he/she does come across someone who might be interested to let you know.

Banks

These guys are happy to lend you money when you don’t need it, but all of the sudden they get stingy when you actually need a loan! This is where preparation comes in.

It’s a good idea to go over your business plan with an expert and maybe even have it rewritten by an expert before you approach either a bank or professional investor. Both will want to go over your business plan with a fine tooth comb, verifying all the numbers and data you provide.

You should also brush up on everything in the plan so that you can answer any questions they have with authority.

Crowdfunding

Finally, there is crowdfunding through sites like Kickstarter or GoFundMe. Crowdfunding helps to build interest, community spirit, and a customer base. It’s also an efficient way to raise funds. You can take a look at these tips to find out more:

6 Crowdfunding Tips To Get Your Project 100 Percent Funded

6. Register with the Government

As stated earlier, different types of business entities have different filling and administrative requirements. At the very least, you’ll probably need a business license as well as a state sales tax license.

Unless you are forming a corporation, there are many good resources on the web that will do everything for you at a minimal cost.

7. Assemble Your Team

Remember when we evaluated your strengths and weaknesses? Here is where we fill in the gaps!

Do you hate sales and cold calling? Great! There are people who love selling and wouldn’t want to do anything else.

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Bored to death with accounting? There are a ton of small accounting firms out there that will take care of that for you.

What about marketing? You can hire someone in-house or out-source that too.

Your job is to keep on top of all the different aspects of the business to make sure they are all running smoothly and getting the results you need. If not, it’s your job to figure out the problem and implement a solution.

Check out this guide and learn how to delegate effectively:

How to Delegate Work (the Definitive Guide for Successful Leaders)

8. Buy Insurance

No matter what kind of business you start, you need insurance! Yes, I know, no one likes to buy insurance, but it can literally be the difference between having a minor inconvenience and declaring bankruptcy.

We live in a very litigious time, even a minor slip and fall at your place of business could bankrupt you without insurance. If you need help finding a good agent, check with your local trade organizations or fellow business owners.

9. Start Branding Yourself

Has anyone ever ask you for a Kleenex or a QTip? We all know what they are because of branding, Kleenex is just a brand of tissue and QTip is just a brand of cotton swab. It doesn’t have to be as widely known as Kleenex or QTip, but you can make your brand a common name within your niche.

I once owned a manufacturing company that developed a product that was so popular that my competitors started co-opting my brand name for their products.

If you aren’t sure how to kickstart branding yourself, check out these ways:

5 Ways to Build your Personal Brand & Make More Money

The Bottom Line

Starting a business from scratch can be one of the most rewarding experiences a person can have.

But do you know what’s even more rewarding? Having a business that succeeds, is profitable and provides a good source of income for you, your employees and their family’s.

More Resources About Entrepreneurship

Featured photo credit: Tyler Franta via unsplash.com

Reference

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