# Understanding Social Security Numbers (SSN): Key Facts & Purposes

## What Is a Social Security Number (SSN)?

A Social Security number (SSN) is a numerical ID for U.S. citizens and residents to track income and benefits.

The SSN was created in 1936 as part of [The New Deal](https://www.investopedia.com/terms/n/new-deal.asp) to provide for retirement and [disability benefits](https://www.investopedia.com/terms/d/disability-insurance.asp). The original intention of the SSN was to track earnings and provide benefits. Now, it is used for additional purposes, such as identifying individuals for tax purposes and tracking credit reports.

In the U.S., people provide their SSNs to get credit, open bank accounts, receive government benefits, and make purchases. There are challenges and risks associated with SSNs, particularly in terms of identity theft and fraudulent use. Learn how to obtain a Social Security number if you don't already have one and the importance of protecting it.

### Key Takeaways

*   A Social Security number (SSN) is issued by the Social Security Administration to track income and determine benefits.
*   SSNs are vital for opening bank accounts, applying for loans, and receiving government benefits.
*   The first three digits of SSNs once indicated the state of issue but are now randomized.
*   Identity theft involving SSNs is a significant risk, requiring caution and preventive measures.
*   Form SS-5 is necessary to apply for or make changes to a Social Security card.

![SSN Card](https://www.investopedia.com/thmb/AdDJ7x_HQY5H8wUC02BW6LNISlk=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/SSN.aspfinal-303ba6ac00e54620a0fb59c3f0a608ef-9c253af2473844388c8727b036423e6e.jpg)

*— Investopedia*

## Understanding the Functionality of Social Security Numbers

Almost all U.S. citizens, permanent residents, and temporary residents have a [Social Security number](https://www.investopedia.com/articles/personal-finance/050615/purpose-having-social-security-number.asp). Non-working residents, both citizens and non-citizens, can also obtain an SSN for business and government uses.

The legal framework for assigning a Social Security number is provided under Section 205(c)(2) of the Social Security Act (42 U.S. Code, Chapter 7, Subsection 405). Social Security numbers and cards are issued by the [Social Security Administration](https://www.investopedia.com/terms/s/ssa.asp) (SSA).

Social Security numbers are now random streams of digits. However, before 2011, the numbers had specific purposes. In those years, the first three digits represented the state in which the number was issued. The next two digits referenced group numbers of issuing offices and the last four represented the order within each group.

Due to concern that this could be falsified, the Social Security Administration instead voted to have it represent a group number. Thus far, no Social Security numbers have been reused, though there have been some cases in which two people were issued the same number.

> **Important**
>
> Scammers are everywhere, so it's important that you keep your information safe and secure. You can avoid scams and report them directly to authorities through the Federal Trade Commission's website.

## Breakdown of Social Security Number Components

### Area Number

The first group of three digits is the area number. It represented the issuing state. States could have more than one number, depending on how many people needed SSNs. Examples of area numbers include 001 to 003 for New Hampshire and 575 to 576 for Hawaii.

Generally, people on the East Coast have the lowest SSNs. Area numbers ascended as the assignment moved westward. So, people on the West Coast tend to have the highest SSNs.

Beginning in 1972, the area number was assigned based on the zip code associated with the mailing address (which isn't necessarily the place of residence) on the application.

There have been exceptions to the original area number assignment process:

*   700–728 were assigned to railroad workers until 1963.
*   586 was assigned to American Samoa, Guam, the Philippines, Americans employed internationally by American companies, and Indochinese refugees (from 1975 to 1979).
*   729–733 were allocated to the Department for Homeland Security for its Enumeration of Entry program for non-citizens admitted to the U.S. for permanent residence.
*   666 will never be assigned.

### Group Number

The next group of two digits is the group number. Group numbers range from 01 to 99. They weren't necessarily assigned consecutively. They originally represented the groups of 10,000 numbers issued to a state's post offices which helped assign SSNs. They came to represent the issuing office.

### Serial Number

The last four digits in the third group comprise the serial number. They ascended from 0001 to 9999 within each group. The serial number 0000 isn't used.

## Historical Timeline of Social Security Numbers

The Social Security number was established as part of a program developed by President Franklin D. Roosevelt to help citizens of the United States following the [Great Depression](https://www.investopedia.com/terms/g/great_depression.asp).

Roosevelt signed the Social Security Act in 1935 to help provide Americans with economic stability, especially to people over the age of 65. This included financial benefits that would be based on the amount of income they received before they entered [retirement](https://www.investopedia.com/terms/r/retirement.asp).

The Social Security Board was established to maintain the [Social Security Act](https://www.investopedia.com/terms/s/social-security-act.asp) and to keep on top of record-keeping. This led to the creation in 1936 of a unique nine-digit number assigned to each individual.  

In 1943, federal agencies were required to use [SSNs](https://www.investopedia.com/ask/answers/082715/why-would-someone-change-their-social-security-number.asp) to identify individuals. Other key moments in the SSN's timeline include:

*   The use of SSNs for tax reporting purposes by the [Internal Revenue Service (IRS)](https://www.investopedia.com/terms/i/irs.asp) in 1962
*   The requirement of banks to obtain SSNs from all their customers as of 1970
*   The need to provide [financial institutions](https://www.investopedia.com/terms/f/financialinstitution.asp) with your SSN for an interest-bearing account in 1983
*   The printing of SSNs on driver's licenses as well as birth and death records in 1996; SSNs were removed from driver's licenses and birth records in 1999
*   The removal of laws requiring the use of SSNs as a way to identify individuals in 2008

In 2011, SSNs began to be issued randomly.

> **Fast Fact**
>
> Although the issuing pattern for SSNs called for numbers to be assigned starting with the most eastern state, the lowest number—001-01-0001—was assigned in 1936 not to a Maine citizen but to a woman residing in Concord, New Hampshire.

## Importance of Having a Social Security Number

A Social Security number is very important to have due to its direct connection to the future benefits you may be entitled to receive from the U.S. government.

An SSN is used to track an individual's yearly earnings and the number of years they've worked. These figures are required to compute potential financial benefits, whether they relate to retirement income, disability income, or health insurance.

When people start their working careers, employers request their Social Security numbers as part of the application process. They provide the IRS with details of salary payments associated with each SSN and the withholdings made for employees' contributions to Social Security and Medicare. Employers report this information to states with an [income tax](https://www.investopedia.com/terms/i/incometax.asp).

### Other Reasons You May Need an SSN

*   To open a bank account or other financial account
*   To apply for a federal loan
*   To apply for unemployment  
    
*   As an identifier on tax returns
*   To get a driver's license
*   To obtain a passport
*   When enrolling in Medicare

## Acquiring a Social Security Number: A Step-by-Step Guide

You can get a Social Security number and card by filling out Form SS-5 from the SSA. The form explains how to obtain an original card, replace a card, and change or correct SSN records. Then follow these steps:

1.  Gather required documents proving age, identity, and citizenship or immigration status.
2.  Submit the completed form and documentation to the Social Security Administration.
3.  Await your Social Security card, which may take two to four weeks, especially if processing is delayed.

The form includes a list of required documents to prove age, identity, and citizenship or immigration status. There is no cost to obtain a number or card. In some circumstances, an individual may [change their Social Security number](https://www.investopedia.com/ask/answers/082715/why-would-someone-change-their-social-security-number.asp).

### 420 Million

The number of Social Security numbers available for assignment.

## SSNs and Identity Theft

Social Security numbers are often used as personal identifiers and for obtaining credit. They contain no biometrics and rely on documentation to prove validity. They are susceptible to use for [identity theft](https://www.investopedia.com/terms/i/identitytheft.asp) and [fraud](https://www.investopedia.com/terms/f/fraud.asp).

A notable example of this is when the chief executive officer (CEO) of identity theft prevention service LifeLock used his SSN in advertisements as a testament to his company's effectiveness. His identity was later stolen multiple times.

There has been some movement among legislators to separate some activities from SSN use, such as renting an apartment or obtaining a hunting or fishing license.

### What to Do If Your SSN Is Stolen

If you discover that your Social Security number is being used by someone else or if you lose your card, there are steps you should consider taking immediately.

*   Contact the [credit reporting agencies](https://www.investopedia.com/personal-finance/top-three-credit-bureaus/) (Experian, TransUnion, and Equifax) to make sure they are aware of the issue; have a security or fraud alert attached to your credit report.
*   Contact the Social Security Administration to notify it of fraudulent use of your number, or the potential for it. If you lost your card, discuss the process to replace it.
*   File a police report on an actual theft of your card or use of your number.
*   Monitor your credit reports for any unauthorized use of existing credit accounts or the unauthorized opening of new accounts.  
    

## How Can I Find Out If Someone Is Using My Social Security Number?

There's no easy way to check and see whether your Social Security number has been compromised. Many people don't find out until it's too late. However, there are a few ways you can keep up-to-date with any unusual activity that may be related to someone else using it. You can monitor your credit reports and bank accounts, verify your income with the Social Security Administration, and request tax transcripts with the IRS.

## What Can Someone Do With Your Social Security Number?

Your SSN is one of the most important pieces of personal information—if not the most important—that you'll ever have. That's why it's so important that you [keep it confidential](https://www.investopedia.com/articles/personal-finance/021216/10-ways-protect-your-social-security-number.asp). Someone who has your SSN can use it to impersonate you, obtain credit and open bank accounts, apply for jobs, steal your tax refunds, get medical treatment, and steal your government benefits.

## What Should You Do If Your Social Security Number Is Stolen?

Identity thieves are everywhere. Contact the Social Security Administration if you suspect that your number is stolen. The agency can help fix problems related to income. If you have problems with your credit, you must contact your financial institution and the credit reporting agencies (Equifax, Experian, and TransUnion). You can also file complaints with IdentityTheft.gov, the IRS, and the Internet Crime Center to report any suspicious activity.

## How Do You Get a New Social Security Number?

To get an SSN, you must fill out form Form SS-5 and provide the SSA with two documents that prove your age and identity, and citizenship or immigration status.

## How Long Does It Take to Get a Social Security Number?

The Social Security Administration mails individuals their Social Security cards as soon as it receives all of the necessary information and documentation. This can take as long as two to four weeks, especially when the administration is facing delays.

## The Bottom Line

A Social Security number, or SSN, is a unique identifying number associated with U.S. citizens and other residents in the country. It's been around since 1936, about the time that the Social Security Administration was established (in 1935) to provide Americans with retirement and disability benefits.

Today, the need for an SSN goes beyond calculating what you're entitled to receive as a result of the contributions you've made throughout your working life to Social Security and Medicare. It's required to open financial accounts, [apply for loans](https://www.investopedia.com/get-personal-loan-cpn-8410224), apply for unemployment assistance, and get a driver's license.

Your Social Security number is key to your future benefits and it's vitally important to safeguard it. So, it's crucial to protect it and the card that it's on. Be sure to use it only when officially required and not simply when someone asks you for it.

> **Article Sources**
>
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>     
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>     
> 3.  Social Security Administration. "[Compilation Of The Social Security Laws](https://www.ssa.gov/OP_Home/ssact/title02/0205.htm)."
>     
> 4.  Social Security Administration. "[Types of Social Security Cards](https://www.ssa.gov/ssnumber/cards.htm)."
>     
> 5.  Federal Reserve Bank of St. Louis. "[Your Social Security Number: The 9-Digit Evolution](https://research.stlouisfed.org/publications/page1-econ/2020/01/02/your-social-security-number-the-9-digit-evolution)."
>     
> 6.  Social Security Administration. "[Social Security Number Randomization](https://www.ssa.gov/employer/randomization.html)."
>     
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>     
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>     
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