Some important considerations and limitations of credit monitoring services include:

• Credit monitoring services typically cost between $10 and $30 or more per month. 
  Is it worth it? That depends... keep reading.

• Federal law allows you to receive copies of your credit reports for FREE.  Learn more...

• Many credit monitoring services only monitor one credit bureau.  Some services may provide an initial three-bureau report on the first order, and then revert to monitoring only one. Consumers should carefully read the fine print before enrolling. While major accounts such as home and auto loans are typically reported to all three national credit bureaus, non-major account creditors often report to only one bureau. A service that does not monitor all three can easily miss accounts reported to one or both of the other bureaus.

• Many creditors report to the credit bureaus only once per month or quarter, and credit bureaus only report what has been reported to them.  More expensive daily or weekly monitoring sounds good, and may provide early notice of credit inquiries, but many potential credit grantors regularly make credit inquiries for pre-approved offers and inquiries often are not differentiated or explained. If a fraudulent account is opened, it may still be 30 days or more before it is reported. In cases involving non-major accounts, such as in-store or utility accounts, the account may never be reported until after it has been sent to collections.

• Credit monitoring can be useful to provide an early warning to the consumer that an account has been opened in his or her name.  Afterwards, however, in most cases the task of disputing the accounts and resolving the matter generally still falls squarely on the consumer's shoulders, unless the service fees also include much more than minor resolution assistance or a few simple form letters.  Rarely does such a service include assistance with any matter beyond financial accounts or those items that are reported on a credit report.

It is also important to note that because of the way that these services are designed, and the way that the credit reporting system functions, the credit monitoring "early warning system" can and does fail. For example, in December of 2006, the New York Times published an article entitled "Protectors, Too, Gather Profits from ID Theft".  A small excerpt from this story follows:

"Melody Millett was shocked when her car loan company asked her if she was the wife of Abundio Perez, who had applied for 26 credit cards, financed several cars and taken out a home mortgage using a Social Security number belonging to her actual husband. Beyond her shock, Mrs. Millett was angry. Five months earlier, the Milletts had subscribed to a $79.99-a-year service from Equifax, a big financial data warehouse, that promised to monitor any access to her credit records. But it never reported the credit activity that might have signaled that they were victims of identity theft."

(New York Times)

• With very rare exceptions, credit monitoring services do not monitor specialty consumer reporting companies (such as ChoicePoint or Chex Systems), public records databases, driver's license records (DMV), criminal records (NCIC), Social Security records (SSA), medical records (such as the Medical Information Bureau), etc.  This means that credit monitoring will not alert you if someone has obtained a driver's license, birth certificate, Social Security card, or other such documents or identification in your name. It also will not alert you if someone has used your name during interactions with law enforcement, resulting in arrest warrants or erroneous criminal records, or if someone has filed taxes or obtained medical benefits or healthcare services under your name and SSN, or any number of other activities. Credit monitoring will also not report to you in a timely fashion, if at all, when an identity thief has obtained employment using your name and Social Security number - in some states, this form of employment fraud approaches one-third of all Identity Theft cases, and can cause victims significant financial cost, inconvenience, and potential tax liabilities.

• If a company or organization with whom you have done business notifies you that your information was lost or stolen, remember that thieves know what actions the company is taking.  When a company or organization has a data breach, and elects to offer credit monitoring to the impacted consumers, what type of service and how long it is being offered are both public knowledge. Thieves can then simply sit on the stolen information until the free service period expires and consumers let their guard down... and then they strike. Once your information is in the hands of thieves, it is not simply used and then thrown away - it is often sold and re-sold to other thieves and victimization (or re-victimization) can occur at any time in the future.