Social Security Number

A Social Security number (SSN) is assigned by the U.S. government to every citizen and any eligible U.S. resident. This nine-digit number is used as an identifier, and it can be tracked to ascertain any individual’s earnings history or credit record. Neal O’Farrell, executive director of the Identity Theft Council, has been quoted saying, “It was the one unique piece of information that would identify every consumer individually.” Social Security numbers are required for obtaining basic needs such as job employment, driver’s licenses, or passports. Your SSN is meant to be protected and services like credit monitoring can help to secure it and keep your identity safe.

Social Security Number History

SSN’s originated in 1935 and were first issued by the Social Security Administration as part of the New Deal Social Security program. Within a few months, 25 million numbers were issued and 45,000 U.S. post offices were designated as typing centers to type up Social Security cards.

Initially the primary use for Social Security numbers was to track income and so there was not a need for children to have SSN’s assigned to them. Up until 1972, the bottom of the card read “for social security purposes, not for identification.” In 1986 the function of the Social Security number changed with the adoption of the Tax Reform Act. This new law required parents to list SSN’s for each dependent that was to be claimed for a tax deduction. This tax break motivated parents to apply for Social Security number’s for their children soon after birth, thus shifting the role of Social Security numbers to a method of identification.

SSN: The Purpose

When applying for a job, an employer is obligated to ask for a Social Security number for the potential employee. This company’s accounting department will use this nine-digit number to report your wages to the Social Security Administration via W-2 forms. An employer may also use an employee’s SSN to verify that he or she is eligible to work in the U.S.

In order to open a bank account, financial institutions require a customer’s SSN. Banks use this number to check the customer’s credit as well as to relay the amount of interest and investment income or losses to the IRS. Social Security numbers are also necessary for acquiring a passport or a driver’s license. SSN’s are crucial when applying for a federal loan or any type of public assistance programs such as disability, or unemployment. A citizen receiving medical treatment, especially if enrolled in Medicare or Medicaid will need to have a Social Security number in order to qualify for care.

Social Security Number Theft

Social Security number theft can unfortunately happen in a variety of ways. A thief can physically steal a Social Security card out of someone’s home or wallet, they can also sift through trash or personal belongings to piece your identity together. Data breaches or cyber leaks of companies containing personally identifiable information often result in Social Security numbers being sold in black markets on the dark web.

Once a criminal has attained a SSN, he or she can open financial accounts in that person’s name, get medical care, commit crimes, and file a fraudulent tax refund.

There are basic preventative measures you can take to secure your SSN. These common-sense suggestions might block a thief from successfully stealing your identity. Giving out your SSN as infrequently as possible, keeping your Social Security card in a safe place, and shredding documents before disposing of them are great recommendations for safeguarding your identity.

Credit Monitoring as a Solution

Banks, credit bureaus, and other financial service companies offer credit monitoring as a safety net for when your SSN is out of reach. Credit monitoring fortifies your personally identifiable information in a way that the average person cannot. Generally, consumers pay anywhere from $10 to $30 a month for these round the clock services. Within this system you will be notified when a new account or credit inquiry shows up on your credit repot. Some services will offer daily internet scanning for unauthorized use of your SSN as well as identity theft insurance. This insurance is meant to cover any private investigator services, lost wages, or legal fees that might be incurred if your identity is stolen.

Recognizing the importance of a Social Security number should prompt you to take any and all necessary precautions to ensure that it stays private. The unauthorized use of your SSN will have lasting effects and could potentially destroy your credit.