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Dangers of giving out your Social Security Number

It has become so common for consumers to simply hand over their Social Security number, without question, that many consumers think they have no option when asked.

From prospective employers and doctor’s offices to service providers, cell phone and utility companies, it is standard for your Social Security number to be requested.

But do you really have to provide your Social Security number in exchange for services? Not really. However, saying no is only half the battle. The real challenge is convincing the people requesting your Social Security number that you really don't have to give it to them.

Original Purpose of a Social Security Number

The Social Security number was originally created to keep track of Americans’ earnings for tax purposes and to monitor benefits paid under the Social Security system. However, the purpose has evolved and the Social Security number is now used as a form of identification.

Who must have your Social Security Number

There are certain instances under the law where you must give out your Social Security number:

  • Anyone who reports income to the IRS such as an employer, the lottery commission or even a casino if you win money.
  • Companies that provide you with credit such as banks, lenders, auto finance company, credit card issuers.
  • Government or State Agencies providing you with benefits such as unemployment benefits, welfare or food stamps.

Entities that really do not need your Social Security number

Requesting a Social Security number is so commonplace that many consumers comply without questioning why that information is needed. A new doctor or dentist, filling out school, little league or camp records for your children can be instances where your Social Security number is requested. But is really not needed.

Think of a job applicant who has not even been granted an interview, why would a potential employer need a Social Security number at this stage of the application process?

When someone requests your Social Security number, you should ask them why they need it, what will happen if you don’t provide it, and if there is an alternative form of identification that can be used.

Refusing to give out your Social Security number

You can always refuse to give out your Social Security number to someone who is not required by law to have it, but be prepared to get a denial of service. Suggest other forms of identification such as a driver’s license or passport.

If you do decide to provide your Social Security number ask questions about how it will be protected because companies and governments seem to have a really tough time of holding onto people's Social Security numbers.

Security breaches are increasing, even for people who you think would have the most secure personal information, such as First Lady Michelle Obama, Vice President Joe Biden and Attorney General Eric Holder.

Dangers of giving out even the last 4-digits of your SSN

The first 3-digits of your SSN represent the geographic region you were in when you applied for the number. The second 2-digits represent a group number that is assigned for administrative purposes. And the last 4-digits are the only part of the Social Security number that makes your number unique from all others. This means giving out the last 4-digits of your Social Security number is riskier than any other part of your number.

Giving out a partial number is no safer than giving out the entire Social Security number. Unlike credit card fraud where charges can be run up but you’ll be aware of it when you get your next bill or are alerted of unusual activity by your credit card issuer, stealing a SSN is totally different.

When a Social Security number is stolen, an identity thief can open new accounts in your name and you may not know for months, even years or until you get denied for credit. Identity thieves opening new accounts rarely pay the bills they incur. Their goal is to make as many charges as possible and walk away. Straightening out identity theft when someone steals your Social Security number is a lot more complex and time consuming.

Always exercise caution when asked for your Social Security number and be careful about sharing your number. You should ask why your number is needed, how it will be used and what will happen if you refuse. The answers to these questions can help you decide if you want to give out your Social Security number.

7 places your social security number is not mandatory

  • Doctor and dentist intake forms
  • Grocery Store Rewards Card Program
  • Retail Store Rewards Card Program
  • Child's School Records
  • Little League Program
  • Summer Camp Program
  • Airlines

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