Each year, millions of Americans are devastated by identity theft and credit card fraud.

Here are a few ways it could go down:

• Your grandma gets a call from a man claiming that her credit card is overdue and she's in danger of legal action. He demands to know her credit card information to "fix" the problem. Your granny thinks she paid off her card, but the man sounds so sure that she hands over her card number and other details. Next month, she sees all kinds of charges she didn't make—she's just been taken in by a phishing scam. She might see her credit score drop and could have collection agencies calling her for months.
• Roger gets a call from his credit card company after his card is declined at the lumber yard. Turns out his account was frozen because of suspicious activity. A customer database from a local store was hacked and credit card numbers were stolen. Roger is pretty lucky—he might not have gotten his new ladder at the lumber yard, but the problem was caught early, before he got a bill with lots of unfamiliar charges.
• Emily sees an amazing deal on Versace purses online. She buys a purse at 2:00AM. She never gets her purse, but when she applies for a car loan two months later, her loan is denied. She gets a copy of her credit report and sees that someone has opened credit cards in her name and racked up more than $20,000 in charges on them.

Credit card fraud and identity theft can happen to anyone. Thieves are always looking for ways to steal identities so that they can charge money, open credit cards, and basically live the good life without paying for it. Thieves and fraudsters range from bored and angsty teens with mad hacking skills to ringleaders of organized criminals.

Protecting Your Identity

Protecting your identity has nothing to do with putting on a fake moustache and adopting an alias (but that's a fun idea for Halloween). To keep thieves and their sticky fingers out of your accounts, there are other things you can do:

(1) Protect your credit card.

• Sign the back of your card.
• Don't just hand over your card when you pay and let someone wander off with it.
• Check your bill each month and report any charges you didn't make.

(2) Stay safe online.

• Use software to get malware off your computer.
• Use good passwords and change them often.
• Clear your browsers so others can't see your passwords.
• Never buy stuff or do online banking on shared networks, free public WiFi connections, or public computers.
• If you're buying something online or sharing personal information, check that the website is secure (hint: the URL of a secure site should start with https).

(3) Read your credit reports at least once a year and report any weird activity.

(4) Be careful how you share your personal information.

• Never send personal information like PIN numbers or credit card numbers in response to emails asking for personal information (even if they seem to come from a legit source).
• Use a shredder to destroy papers that have credit card information, bank information, and personal information (thieves sometimes steal credit card offers or mail from garbage cans to get their grubby hands on enough personal information to con you).
• Don't share personal information with companies or people unless they absolutely need that information.
• Never give personal information like credit card numbers over the phone if someone calls asking for it (if the call seems urgent and the caller claims to be calling from your bank or credit card company, hang up and call the number on your credit card or bank statement to find out whether the call was legitimate).

You don't want to go through life wearing a tin foil hat and worrying that "they're" coming to get you—those hats are mighty impractical, after all. Being a little cautious, though, can help you avoid getting taken for a ride.