In very basic terms, putting a freeze on your credit profile is like adding a password to your net worth. It prevents anyone else from establishing credit in your name, thus reducing your risk of identity theft. It can also help you protect your credit score by reducing the number of inquiries on your credit. Having a credit freeze in place can even help you avoid the urge to apply for retail credit cards that give you an instant savings on your purchases.

While some of the credit bureaus will assign a password to you upon adding the freeze, others will allow you to choose your own, in which case, make it a strong, alpha-numeric-symbol based password. We recommend writing your passwords down right away and storing the information in a secure and convenient location, such as a personal safe.

In the event that you need to apply for credit, all you have to do is call each of the credit bureaus first and provide your password. Each bureau will “thaw” your credit profile for a period of time that you dictate, be it one day or one week, after which it will automatically re-freeze.

To freeze your credit, simply visit each of the three credit bureau websites and follow the prompts: Equifax, TransUnion and Experian.