How often should individuals check their credit reports according to best practices?

Individuals should check their credit reports at least annually as part of best practices for maintaining financial health and safeguarding against identity theft. Regularly reviewing credit reports enables individuals to monitor their credit history for accuracy, identify any unauthorized accounts or activities, and catch potential signs of fraud early. This practice is critical because errors or fraudulent activities can have a significant impact on credit scores and overall financial reputations.

Annual checks are recommended because they are sufficient for most individuals to stay informed about their credit status. With free credit reports available once a year from each of the major credit reporting agencies, individuals can stagger their requests throughout the year to ensure they are checking their reports regularly without incurring costs.

While checking credit reports every month can provide a more frequent update, it may not be practical for everyone and is generally not necessary for routine monitoring. Checking only when applying for a new loan could lead to missed opportunities for spotting identity theft or errors well in advance, and waiting every two years may leave individuals vulnerable to undetected issues that can affect their credit health. Thus, annual monitoring strikes the right balance between vigilance and practicality.