Freezing your credit report used to cost money — up to $60 plus fees, including the cost of later removing the freeze. But now, thanks to an amendment to the Fair Credit Reporting Act in effect as of Friday, you can do it for free.

A credit freeze is a protective measure. It blocks a lender or financial institution from checking your report, so a hacker is unable to use your information to open a new bank account or take out a loan. The only real downside is that it's a minor inconvenience, because you can't open a new account or take out a loan either. A freeze doesn't affect your credit score, though, or your ability to use your credit card.

Many consumers are left wondering when, if ever, to make use of this complimentary service. One clear answer: At the first whiff of danger.

"The most obvious time to do a credit freeze is if you've been notified by a merchant or bureau that there's been a data breach or that your information may have been compromised," Ashley Dull, credit strategist at CardRates.com, tells CNBC Make It. "This new law makes it a lot easier to take preventative versus reactive measures in these cases."

The new legislation was passed after the major credit bureau Equifax was hacked in the summer of 2017, exposing the personal data of 148 million consumers to potential fraud. That's roughly 44 percent of the U.S. population. And yet, in the year since, one study found that only 8 percent of consumers have protected themselves by freezing their credit.