Why Does Robinhood Need SSN?
So you've heard about Robinhood's free trading, and you've finally decided to open an account to see if it's true (yes, it's accurate, trades really are
commission-free, and they give away free stock for opening an account).
Still, you're uncertain why they're requesting your Social Security Number (SSN) while you're setting up the account. It's very personal—why do they
need it?
The short answer is that every broker (not just Robinhood) must gather this and other personal data for
anyone wanting to open an account, as required by the U.S. government. Beyond government mandates, self-regulating
groups in Financial Services, such as the Financial Industry Regulatory Authority (FINRA), also advise brokers to collect this information. There are two main reasons for this requirement, which we'll explain below.
Record-Keeping Requirements
The Securities and Exchange Commission (SEC) instructs brokers to gather personal identification details from anyone wanting to open an account,
including name, address, date of birth, government ID, net worth, and SSN, among other data. Technically, it's not legally required for brokers to record your SSN if you decide not to provide it, but they must make a genuine effort to get it. Given how automated the account opening process is, it’s practically impossible to finish setting up the account without giving this information. Even if you tried calling Robinhood to argue against this request, you'd have trouble, because their customer support system is extremely minimal.
Anti-Money Laundering Preventative Measures
The SEC and the U.S. Department of the Treasury jointly put in place the customer identification rule, which means financial
institutions must gather your SSN before letting you open an account. This rule requires brokers to verify the identities of
new account holders and to check if they appear on any government list of known or suspected terrorists. This measure was
introduced to help prevent money laundering, a major funding source for terrorist groups. So, even though it's not strictly required for record-keeping purposes to submit your SSN, it is mandated by the customer identification rule.
As a result, brokers won't let you skip this step, because that would break the law and could lead to punishment from the government.
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Personal Information to Determine Investment Suitability
Even beyond the legal rules, brokers are advised by industry bodies like FINRA to gather your personal
details because this, in theory, puts them in a better position to assist you, or at least avoid harming you,
as you pursue your financial objectives. These bodies suggest brokers gather information such as net worth, salary,
and career history to avoid unintentionally recommending an investment that doesn't fit the risk profile implied by your details (or at least the one they infer based on what you provide).
All U.S. Brokers Ask For SSN
As a result of the above government regulations, every U.S. brokerage firm
will ask you for your Social Security Number. There's no way around it. Is it safe? If
history teaches us anything, brokers have generally done a solid job of protecting your personal details
and your funds.
Updated on 2/22/2025.
Paul Johnson is a Licensed Stockbroker with 7+ years of experience in the financial services industry. Paul enjoys teaching about investing and writing about financial topics. He is a husband and father of twin boys.
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