Why parents may want to start locking a child’s credit at a very young age

Published

8 months ago

August 23, 2024

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Most parents would take herculean steps to protect their children. But many overlook a relatively simple way to help shore up a child’s financial security: freezing the minor’s credit.

This could be especially important in the wake of a major breach in which the Social Security numbers of myriad Americans might be for sale on the dark web. While locking their credit won’t solve all cybersecurity issues related to stolen Social Security numbers, it’s one extra layer of protection parents can implement.

The credit-locking process involves contacting each of the three major credit bureaus — Experian, Equifax and TransUnion — and providing required documentation including the child’s birth certificate, Social Security card, proof of address and parent identification. The bureau then creates a credit report for the child and then locks it, so loans or credit cards can’t be issued using the child’s personal information. The freeze remains in place until the parent, or in some cases, the child, requests that it be lifted, temporarily or permanently.

Parents can take these steps proactively even if there’s nothing to suggest a minor’s credit has been compromised such as unexpected credit card solicitations or bills received in the minor’s name.

It can take some time and effort to lock a child’s credit, but the outlay is minimal compared with what can be a lengthy and emotional credit restoration process. “As an adult, if our credit is stolen, it makes us angry, but we do what needs to be done and we move forward,” said Kim Cole, community engagement manager at Navicore Solutions, nonprofit credit and housing counseling agency. But for children, the emotional impact is much greater, she said. “It can take years to get wind of a problem, and meanwhile the damage can continue to grow.”

Identity theft against children — especially very young ones — often slips under the radar until they are older teens or young adults applying for their first credit card, trying to finance a car or seeking student loans, said Loretta Roney, president and chief executive of InCharge Debt Solutions, a nonprofit provider of credit counseling and other services.

Yet, identity theft for children under age 19 is a growing issue, with this demographic accounting for 3% of all identity theft reports for the first half of 2024, according to Federal Trade Commission data. By comparison, this demographic accounted for 2% of identity fraud reports each year between 2021 and 2023.

Thieves might use a child’s Social Security number, name and address, or date of birth to do things like apply for government benefits, like health care coverage or nutrition assistance, open a bank or credit card account, apply for a loan, sign up for a utility service or rent a place to live, according to the FTC. Locking a child’s credit won’t protect against all of these, but it’s a solid step in the right direction, financial professionals said.

It’s not just strangers committing fraud against children. Cole offers the example of a friend whose uncle had destroyed his credit and started using his niece’s name and Social Security number to open credit cards and max them out. He had the bills sent to his house, and the young woman only discovered the fraud about four years later, when she went to buy a small fixer-upper and realized she had nearly $50,000 of debt in her name and a credit score in the low 500s.

The niece filed a police report, a complaint with the FTC and disputed the items with the credit bureaus, but it took time to resolve. She applied for a secured credit card in the interim, since her score was too low to qualify for a traditional card, and the situation pushed back her home-buying by a few years, ultimately costing her more, Cole said.

Check to see if the child has a credit report

Before locking a child’s credit, it’s good practice to check with each of the three major credit bureaus to see if a report exists. Generally, this will only be the case if someone has fraudulently taken out credit in the minor’s name, or if the child has been named an authorized user on an adult’s credit card.

To check to see if their child has a credit report, parents can mail a letter with their request to each of the credit bureaus. They should be sure to include a copy of the child’s birth certificate, Social Security card or document from the Social Security Administration showing this number and a copy of the parent’s driver’s license or government-issued identification, with current address. Legal guardians may have to give the credit bureaus a copy of documents authenticating their status.

If something amiss pops up on the report, contact the companies where the fraud occurred as well as the three major credit bureaus. Also report the child identity theft to the FTC, including as many details as possible.

If the report comes back clean, the next step is to actually lock the child’s credit.

If needed, freeze a child’s credit

The process for initiating a credit freeze varies slightly depending on the credit bureau and the age of the minor child. Be sure to follow the precise instructions for each credit bureau. For Equifax, in addition to required documentation, parents need to fill out a form online and submit it via postal mail; minors who are 16 or 17 may request their own security freeze by phone or by mail. The websites for Experian and TransUnion provide further details on their respective processes, which includes document requirements and mailing addresses. It can take a few weeks for the bureaus to process these requests.

Keep good records for unlocking later in life

Parents need to keep safe the pin number they are provided when locking their child’s credit so it can be temporarily unlocked as needed, such as when the child turns 18 and wants to apply for a credit card, said Bruce McClary, senior vice president of membership and media relations at the nonprofit National Foundation for Credit Counseling.

The unlocking process isn’t necessarily seamless and can take time. Equifax, for instance, asks for these requests in writing, with required documentation for identity verification purposes. After age 18, Equifax allows for managing the security freeze online.

Educate children early on protection of personal information

Parents should talk to their children about best practices with respect to sharing personal information, McClary said. For instance, they should caution children to be careful about the kinds of information they provide to websites and apps and to keep their Social Security number close to the vest.

Parents may also want to consider credit or identity threat monitoring services or both. Certain providers may offer basic services for free, but family plans that include adults and children and offer a combination of credit and identity theft protection tend to be fee-based. These services — which can run around $24 or more per month — may offer more comprehensive protection, including identity theft insurance and fraud resolution services. Parents should weigh the options carefully to understand the choices and associated costs.

Technology

Silicon Valley’s early return on Trump investment: Plunging valuations, delayed IPOs

Published

9 hours ago

April 5, 2025

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Silicon Valley's early return on Trump investment: Plunging valuations, delayed IPOs

The Nasdaq MarketSite in New York, June 9, 2023.

Michael Nagle | Bloomberg | Getty Images

Silicon Valley executives and financiers publicly opened their wallets in support of President Donald Trump’s 2024 presidential run. The early returns in 2025 aren’t great, to say the least.

Following Trump’s sweeping tariff plan announced Wednesday, the Nasdaq suffered steep consecutive daily drops to finish 10% lower for the week, the index’s worst performance since the beginning of the Covid pandemic in 2020.

The tech industry’s leading CEO’s rushed to contribute to Trump’s inauguration in January and paraded to Washington, D.C., for the event. Since then, it’s been a slog.

The market can always turn around, but economists and investors aren’t optimistic, and concerns are building of a potential recession. The seven most valuable U.S. tech companies lost a combined $1.8 trillion in market cap in two days.

Apple slid 14% for the week, its biggest drop in more than five years. Tesla, led by top Trump adviser Elon Musk, plunged 9.2% and is now down more than 40% for the year. Musk contributed close to $300 million to help propel Trump back to the White House.

Nvidia, Meta and Amazon all suffered double-digit drops for the week. For Amazon, a ninth straight weekly decline marks its longest such losing streak since 2008.

With Wall Street selling out of risky assets on concern that widespread tariff hikes will punish the U.S. and global economy, the fallout has drifted down to the IPO market. Online lender Klarna and ticketing marketplace StubHub delayed their IPOs due to market turbulence, just weeks after filing with the Securities and Exchange Commission, and fintech company Chime is also reportedly delaying its listing.

CoreWeave, a provider of artificial intelligence infrastructure, last week became the first venture-backed company to raise more than $1 billion in a U.S. IPO since 2021. But the company slashed its offering, and trading has been very volatile in its opening days on the market. The stock plunged 12% on Friday, leaving it 17% above its offer price but below the bottom of its initial range.

“You couldn’t create a worse market and macro environment to go public,” said Phil Haslett, co-founder of EquityZen, a platform for investing in private companies. “Way too much turbulence. All flights are grounded until further notice.”

CoreWeave investor Mark Klein of SuRo Capital previously told CNBC that the company could be the first in an “IPO parade.” Now he’s backtracking.

“It appears that the IPO parade has been temporarily halted,” Klein told CNBC by email on Friday. “The current tariff situation has prompted these companies to pause and assess its impact.”

Tech will see an 'economic armageddon' if these tariffs stay, says Wedbush's Dan Ives

‘Cave rapidly’

During last year’s presidential campaign, prominent venture capitalists like Marc Andreessen backed Trump, expecting that his administration would usher in a boom and eliminate some of the hurdles to startup growth set up by the Biden administration. Andreessen and his partner, Ben Horowitz, said in July that their financial support of the Trump campaign was due to what they called a better “little tech agenda.”

A spokesperson for Andreessen Horowitz declined to comment.

Some techies who supported Trump in the campaign have taken to social media to defend their positions.

Venture capitalist Keith Rabois, a managing director at Khosla Ventures, posted on X on Thursday that “Trump Derangement Syndrome has morphed into Tariff Derangement Syndrome.” He said tariffs aren’t inflationary, are effective at reducing fentanyl imports, and he expects that “most other countries will cave and cave rapidly.”

That was before China’s Finance Ministry said on Friday that it will impose a 34% tariff on all goods imported from the U.S. starting on April 10.

At Sequoia Capital, which is the biggest investor in Klarna, outspoken Trump supporter Shaun Maguire, wrote on X, “The first long-term thinking President of my lifetime,” and said in a separate post that, “The price of stocks says almost nothing about the long term health of an economy.”

However, Allianz Chief Economic Advisor Mohamed El-Erian warned on Friday that Trump’s extensive raft of import tariffs are putting the U.S. economy at risk of recession.

“You’ve had a major repricing of growth prospects, with a recession in the U.S. going up to 50% probability, you’ve seen an increase in inflation expectations, up to 3.5%,” he told CNBC’s Silvia Amaro on the sidelines of the Ambrosetti Forum in Cernobbio, Italy.

Former Microsoft CEOs Bill Gates, left, and Steve Ballmer, center, pose for photos with CEO Satya Nadella during an event celebrating the 50th Anniversary of Microsoft on April 4, 2025 in Redmond, Washington.

Stephen Brashear | Getty Images

Meanwhile, executives at tech’s megacap companies were largely silent this week, and their public relations representatives declined to provide comments about their thinking.

Microsoft CEO Satya Nadella was in the awkward position on Friday of celebrating his company’s 50th anniversary at corporate headquarters in Redmond, Washington. Alongside Microsoft’s prior two CEOs, Bill Gates and Steve Ballmer, Nadella sat down with CNBC’s Andrew Ross Sorkin for a televised interview that was planned well before Trump’s tariff announcement.

When asked about the tariffs at the top of the interview, Nadella effectively dodged the question and avoided expressing his views about whether the new policies will hamper Microsoft’s business.

Ballmer, who was succeeded by Nadella in 2014, acknowledged to Sorkin that “disruption is very hard on people” and that, “as a Microsoft shareholder, this kind of thing is not good.” Ballmer and Gates are two of the 12 wealthiest people in the world thanks to their Microsoft fortunes.

C-suites may not be able to stay quiet for long, especially if the recent turmoil spills into next week.

Lise Buyer, who previously helped guide Google through its IPO and now works as an adviser to companies going public, said there’s no appetite for risk in the market under these conditions. But there is risk that staffers get jittery, and they’ll surely look to their leaders for some reassurance.

“Until markets settle out and we have the opportunity to access valuation levels, public company CEOs should work to calm potentially distressed employees,” Buyer said in an email. “And private company managements should refine plans to get by on dollars already in the treasury.”

— CNBC’s Hayden Field, Jordan Novet, Leslie Picker, Annie Palmer and Samantha Subin contributed to this report.

WATCH: Chime is reportedly delaying its IPO

Technology

Tesla’s June robotaxi deadline looms as political backlash builds over Elon Musk

Published

10 hours ago

April 5, 2025

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Tesla's June robotaxi deadline looms as political backlash builds over Elon Musk

Elon Musk has been promising investors for about a decade that Tesla’s cars are on the verge of turning into robotaxis, capable of driving themselves cross-country, after one big software update.

That hasn’t happened yet.

What Tesla offers is a sophisticated, but only partially automated, driving system that’s marketed in the U.S. as its Full Self-Driving (Supervised) option, though many Tesla fans refer to it as FSD. In China, Tesla recently changed the system’s name to “intelligent assisted driving.”

Full Self-Driving, as it was previously called, relies on cameras and software to enable features like automatic navigation on highways and city streets, or automatic braking and slowing in response to traffic lights and stop signs.

Tesla owner’s manuals warn users that FSD “is a hands-on feature” that requires them to pay attention to the road at all times. “Keep your hands on the steering wheel at all times, be mindful of road conditions and surrounding traffic,” the manuals say.

But many of Tesla’s customers ignore the fine print and use the system hands-free anyway.

Tesla’s partially automated driving systems have been a source of inspiration for its stalwart fans. But they’ve also caused controversy and concern for public safety after reports of injurious and fatal collisions where Tesla’s standard Autopilot or premium FSD systems were known to be in use.

FSD does a lot of things “amazingly well,” said Guy Mangiamele, a professional test driver for automotive consulting firm AMCI Testing, during a recent long drive in Los Angeles. But he added that “the times that it trips up, you could kill somebody or you could hurt yourself.”

The pressure has never been higher on Tesla to elevate the technology and deliver on Musk’s long-delayed promises.

The Tesla CEO is the wealthiest person in the world and was the biggest financial backer of President Donald Trump’s 2024 campaign. Since Trump’s January inauguration, Musk has been leading the administration’s Department of Government Efficiency effort to drastically slash the federal workforce and government spending.

The DOGE team has been connected to more than 280,000 layoff plans for federal workers and contractors impacting 27 agencies over the last two months, according to data tracked by Challenger Gray, the executive outplacement firm.

Musk’s work with DOGE – along with his frequently incendiary political rhetoric and endorsement of Germany’s far-right, anti-immigrant party AfD – has led to a tremendous backlash against Tesla.

Protests, boycotts and even criminal acts of vandalism have targeted the electric vehicle maker in recent months and led many prospective Tesla customers to turn to other brands. Meanwhile, existing Tesla owners have been trading in their EVs at record levels, according to data from Edmunds.

Tesla’s stock dropped 36% through the first three months of 2025, representing its steepest decline since 2022 and third-biggest slide for any quarter since the EV maker went public in June 2010. Tesla also reported 336,681 vehicle deliveries in the first quarter of 2025, a 13% decline from the same period a year ago.

Product unveilings and a “robotaxi launch” expected from Tesla in Austin, Texas, this year could revitalize investors’ sentiment about the company and hopefully lift its share price, Piper Sandler analysts wrote in a note following the worse-than-expected deliveries report.

On Tesla’s last earnings call, Musk promised investors that Tesla will finally start its driverless ride-hailing service in Austin in June.

To see whether the company’s FSD technology is anywhere close to a robotaxi-ready release, CNBC spent months riding along with Tesla owners who use Full Self-Driving (Supervised) and speaking with automotive safety experts about their impressions.

Auto-tech enthusiast and Tesla owner Chris Lee, host of the YouTube channel EverydayChris, told CNBC that Tesla’s system “definitely has a ways to go, but the fact that it’s able to go from where it was three years ago to today, is insane.”

Many experts, including Telemetry Vice President of Market Research Sam Abuelsamid, remain skeptical. There’s been “no evidence” that FSD is “anywhere close to being ready to be used in an unsupervised form” by June, said Abuelsamid, whose firms specializes in automotive intelligence.

Tesla FSD will “often work really well, particularly in daytime conditions” but then “randomly, in a scenario where it did fine previously, it will fail,” said Abuelsamid, adding that those scenarios can be unpredictable and dangerous.

Watch the video to learn more about the evolution of Tesla’s Full Self-Driving (Supervised) and whether it will be robotaxi-ready this June.

Technology

Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

Published

23 hours ago

April 5, 2025

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Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

Microsoft owns lots of Nvidia graphics processing units, but it isn’t using them to develop state-of-the-art artificial intelligence models.

There are good reasons for that position, Mustafa Suleyman, the company’s CEO of AI, told CNBC’s Steve Kovach in an interview on Friday. Waiting to build models that are “three or six months behind” offers several advantages, including lower costs and the ability to concentrate on specific use cases, Suleyman said.

It’s “cheaper to give a specific answer once you’ve waited for the first three or six months for the frontier to go first. We call that off-frontier,” he said. “That’s actually our strategy, is to really play a very tight second, given the capital-intensiveness of these models.”

Suleyman made a name for himself as a co-founder of DeepMind, the AI lab that Google bought in 2014, reportedly for $400 million to $650 million. Suleyman arrived at Microsoft last year alongside other employees of the startup Inflection, where he had been CEO.

More than ever, Microsoft counts on relationships with other companies to grow.

It gets AI models from San Francisco startup OpenAI and supplemental computing power from newly public CoreWeave in New Jersey. Microsoft has repeatedly enriched Bing, Windows and other products with OpenAI’s latest systems for writing human-like language and generating images.

Microsoft’s Copilot will gain “memory” to retain key facts about people who repeatedly use the assistant, Suleyman said Friday at an event in Microsoft’s Redmond, Washington, headquarters to commemorate the company’s 50th birthday. That feature came first to OpenAI’s ChatGPT, which has 500 million weekly users.

Through ChatGPT, people can access top-flight large language models such as the o1 reasoning model that takes time before spitting out an answer. OpenAI introduced that capability in September — only weeks later did Microsoft bring a similar capability called Think Deeper to Copilot.

Microsoft occasionally releases open-source small-language models that can run on PCs. They don’t require powerful server GPUs, making them different from OpenAI’s o1.

OpenAI and Microsoft have held a tight relationship shortly after the startup launched its ChatGPT chatbot in late 2022, effectively kicking off the generative AI race. In total, Microsoft has invested $13.75 billion in the startup, but more recently, fissures in the relationship between the two companies have begun to show.

Microsoft added OpenAI to its list of competitors in July 2024, and OpenAI in January announced that it was working with rival cloud provider Oracle on the $500 billion Stargate project. That came after years of OpenAI exclusively relying on Microsoft’s Azure cloud. Despite OpenAI partnering with Oracle, Microsoft in a blog post announced that the startup had “recently made a new, large Azure commitment.”

“Look, it’s absolutely mission-critical that long-term, we are able to do AI self-sufficiently at Microsoft,” Suleyman said. “At the same time, I think about these things over five and 10 year periods. You know, until 2030 at least, we are deeply partnered with OpenAI, who have [had an] enormously successful relationship for us.

Microsoft is focused on building its own AI internally, but the company is not pushing itself to build the most cutting-edge models, Suleyman said.

“We have an incredibly strong AI team, huge amounts of compute, and it’s very important to us that, you know, maybe we don’t develop the absolute frontier, the best model in the world first,” he said. “That’s very, very expensive to do and unnecessary to cause that duplication.”

WATCH: Microsoft Copilot beginning of a seismic shift in AI integration, says Microsoft AI CEO Suleyman