Information is like currency these days. Data is being collected constantly, from social media apps and store accounts to casual online browsing. And that data is then often shared, interpreted, and even sold. Naturally, that can make considering all the possibilities of where your data may end up overwhelming.
There are, of course, necessary reasons you may need to share your personal information. But how can you tell if something is legitimate or a scam? While nothing is foolproof, these are a few situations that typically require sharing of personal information.
1. You’re Renting a Place to Live
You’ve found your dream place and are excited to make things official. But before you can start planning your decor and decorating, you need to apply and be approved. To do that, rental companies need to follow their processes to make sure you’re a good fit.
The most common information required to rent a property is identity verification and income verification. Rentals are typically communal living spaces, so it’s important to ensure people are who they say they are. Rental companies also want to make sure the risk of signing a lease is worthwhile from a business standpoint. For that, they’ll need to ensure you meet their income requirements by reviewing official financial documentation.
Many complexes share application requirements on their website, so check that information ahead of time. You can also head to the leasing office to better understand acceptable documentation. Most places will take driver’s licenses and W-2s, but some rentals may have more specific requirements. It also doesn’t hurt to ask about what cybersecurity measures are in place if you have concerns.
2. You’re Taking Out A Loan
Securing financing for big purchases is a milestone in life. There’s also a process involved tailored to each type of loan you may need. Most of which will require you to share personal information.
Car Loan
New or used, large or small, buying a vehicle oftentimes requires a loan. And lenders need access to your personal information to mitigate risk. For example, credit reports are used to help determine the annual percentage rate (APR) you’ll pay on the loan. Income verification and other forms of financial documentation may also be required.
Home Loan
Getting a mortgage to buy a home means complying with several requirements. Lenders will need to know your credit history, current salary, outstanding debt, and more about your finances. This helps them determine your interest rate and how much of a loan you can afford to pay back. From there, you’ll determine your loan length — typically 15 or 30 years — and analyze if the monthly payment is manageable.
3. You’re on the Hunt for a New Job
Whether your current job just isn’t working out or you’re looking for a new challenge, changing jobs is a process. Part of that process includes sharing personal information with your new company to verify you are who you say you are. However, it’s essential to understand what is and is not considered normal.
Many companies require background checks and identity verification before onboarding a new person. They need specific information for tax purposes and some information to keep on file for their records. But do legitimate jobs need to verify your current income? It depends.
If you’re making a move for a higher salary, your new company may want to confirm your previous salary. That can help them justify the cost for their bottom line. However, your new company requesting your current W2 doesn’t mean you have to, or should, provide it. Depending on your state’s laws, it may be illegal to do so because salaries can be considered private information. Your current role may also have policies around sharing salary specifics, so double check those before proceeding.
If neither of those instances is the case, it’s up to you to determine the best way to go about answering a potential employee’s questions.. Remember that tax documents often have personal data, so opt to encrypt files if you send them digitally. Also, verify the email address you’re sending to, so you avoid potential harm.
4. You’re Applying for Government Programs
Most government assistance programs require participants to meet some eligibility requirements. The programs exist to help people, so ensuring that the applicants are in need is vital to keeping them running. Here are some common programs that understandably need personal information.
Health Insurance
The government provides healthcare options to try and make it more accessible to the public. These programs — like Medicare and Medicaid — have application processes to determine eligibility and grant benefits. Naturally, these processes involve the verification of income and identity.
Financial Aid
Pursuing a college degree is a great career step for many people. But the cost of college can deter students from pursuing the degrees they want. That’s why so many students choose to explore financial aid options. Whether you’re looking at scholarships and grants or student loans, financial aid requires personal information about your income to determine eligibility.
Typically, they’ll ask for your tax returns while you’re completing your FAFSA (Free Application for Federal Student Aid. With this information, they’ll calculate your EFC (expected family contribution). That’s how much they think you or your parent(s) can reasonably afford to pay. The lower the EFC, the more aid you’ll qualify for.
Food Assistance
The government has food assistance programs in place to help reduce hunger and improve nutrition for those in need. Each program has its application process and eligibility requirements, but income verification is often involved. With limited funds and the goal of helping as many people as possible, strict reviews are often required. And that makes providing personal information necessary.
Trust Your Gut
While all of these situations can require you to share W2s and other personal information, there’s no guarantee they’re all legitimate. Data breaches and outright scams can appear as real institutions, making it hard to tell them apart. That only further intensifies the need for you to be diligent.
Do your research. Verify the legitimacy of the entity you’re looking to share information with. Make sure the safety lock is displayed in the URL bar, and only give information to people you’ve sought out yourself. Ultimately, if something doesn’t feel right, don’t be scared to walk away or ask for them to provide assurance they are who they claim to be. You’ll be happy you did what felt right and grateful to keep your personal information safe.