You’ve probably heard the terms “credit card fraud” and “identity theft” before. Maybe hearing those words even makes you cringe a little bit, because you worry about the safety of your personal information. But the first step to protecting yourself in these situations is to understand what each of these things actually is.

Quick tip: credit card fraud and identity theft are not synonymous, even though they’re often used that way.

Let’s take a look at what both of these things are so you can better protect yourself from both.

Identity Theft

Identity theft is when someone else steals your identity; they pretend to be you. Your identity can be stolen if someone knows personal details about you that would allow them to sign up for things in your name. Just think of all of the personal details you have to give on a loan application for example. If someone knows that information, they can fill one out pretending to be you.

How to protect yourself: Don’t leave personal information lying around — bank statements, credit card statements, your driver’s licence, or anything with your address, birth date, or phone number on it. The harder it is for someone to get personal details about you, the less likely it is that they’ll have enough to open various types of accounts in your name.

Credit Card Fraud

While credit card fraud is not synonymous with identity theft, it can be a result of it. When someone steals your identity, they might use that personal information to sign up for new credit cards in your name. They then run up the bill and have no intention of paying the balance, which damages your credit history in the meantime until it’s straightened out.

That isn’t the only type of credit card fraud though. For example, someone could steal your credit card and use it to make fraudulent purchases. People can use phishing tactics to get you to enter your credit card information online which they save and use for other online purchases. Or a company could even process fraudulent payments after you give them your details for a legitimate one.

How to protect yourself: Shop only with retailers you trust (especially online where new sites can pop up overnight), and keep your credit card in your view at all times when you give it to a cashier. Check your credit card statements regularly too, and look for any unusual activity or purchases you don’t believe you authorised. Contact the credit card company immediately if you find anything suspicious.

Neither credit card fraud or identity theft is a laughing matter. They can both lead to serious problems that can take a significant amount of time — not to mention frustration — to sort out. Keep an eye on your credit file and all account statements (credit cards or otherwise) and be careful with your personal information. Some basic precautions can save you a huge headache later.