Dec. 20, 2013 at 12:52 PM ET
Would you like to stop companies from selling your financial information for marketing purposes? If you could eliminate junk mail and save millions of trees per year, would you?
Ask 10 people, and you’ll probably get as many volunteers. Why, then, have so few Americans opted out of pre-approved financial offers?
I think it’s because consumers aren’t sure of the answers to three questions. First, why should I care about opting out? Second, how do I do it? Third, will opting out impact my credit score, overall financial situation or ability to apply for credit cards?
Caring, awareness and trust — that’s what it boils down to.
So let’s go over why you should care about opting out and how to do it.
First, there are both selfish and selfless reasons to opt out. On the selfish side, companies are selling your financial data — Social Security number, address, payment history and more — to marketers who, in turn, use your information to solicit you as a potential new customer.
On the selfless side, there are billions of pieces of junk mail sent every year. Collectively, junk mail is estimated to cost Mother Earth more than 100 million trees each year. Opting out does us all a favor.
Next, you should know that opting out takes less than five minutes and can be done online. The government requires the sellers of your financial data — the major credit reporting agencies — to provide a mechanism that allows you to opt out of pre-approved junk mail. That’s why a website called Optoutprescreen.com was created.
Optoutprescreen.com is a website provided by four major credit reporting agencies — Equifax, Experian, TransUnion and Innovis — that allows consumers to opt out of receiving credit card offers by mail. The site is approved by the Federal Trade Commission.
So if you care about opting out, now you know how to do it. Next up: trust. Although Optoutprescreen does request personal data, such as your Social Security number (which it encrypts), it does not require all of it. The only required fields are first name, last name and current address. Optoutprescreen states that providing the other information will help the credit reporting bureaus process your request. (Full disclosure, Wisely, the company I own, has its own opt out tool. We forward data directly to Optoutprescreen, but we do not require that the user enters unnecessary information, for example, your Social Security number.)
Last, people may wonder if opting out will help their credit. There have long been rumors that opting out will actually improve your credit score. That’s not so. Opting out has no effect on your credit score or other aspects of your finances. Also, opting out has no effect on your ability to apply or be approved for credit cards.
Mike Vichich is the CEO and cofounder of Wisely, a mobile app that analyzes consumer purchase behavior to find popular, quality places that meet users' price range. Visit the company's website to learn more about how to Shop Wisely.