When you're applying for a job, your potential employer will likely conduct a background check before deciding whether to hire you. Part of that background check will involve a financial background check, which will help the employer assess your financial responsibility and trustworthiness. But what financial records are typically included in a financial background check? In this article, we'll explore the different types of financial records employers might look at and what they're looking for.
# Credit Reports
One of the most common financial records employers will look at is your credit report. Your credit report provides a snapshot of your credit history and includes information about your credit accounts, payment history, and outstanding debts. Employers might look at your credit report to assess your financial stability, responsibility, and trustworthiness.
For example, if you're applying for a job in finance or accounting, your employer might be hesitant to hire you if your credit report shows a history of missed payments, unpaid debts, or bankruptcy. Similarly, if you're applying for a position where you'll be responsible for handling money or finances, your employer might be wary if your credit report shows a pattern of financial irresponsibility or mismanagement.
# Bank Records
Employers might also look at your bank records as part of a financial background check. This can include bank statements, cancelled checks, and records of transactions. Your bank records can provide insight into your financial habits and responsibilities, such as whether you pay your bills on time, how much you spend on certain types of purchases, and whether you have a history of bouncing checks.
For example, if you're applying for a job in a position that requires handling financial transactions, such as a bank teller or accountant, your potential employer might want to see if you have a history of overdrafts or NSF fees. Alternatively, if you're applying for a job in sales or marketing, your employer might be interested in seeing your bank records to assess your spending habits and whether you have a history of making large purchases or taking out loans.
# Tax Returns
Your tax returns can also be part of a financial background check. Employers might want to see your tax returns to verify your income, assess your financial stability, and determine whether you're up-to-date on your taxes. Your tax returns can also provide insight into your financial situation, such as whether you have a lot of deductions, whether you receive income from multiple sources, and whether you have investments or other assets.
For example, if you're applying for a job in a position where you'll be handling sensitive financial information or working with high-net-worth clients, your employer might want to see your tax returns to verify your income and assess your financial stability. Additionally, if you're applying for a job in a field where your earning potential is closely tied to your performance, such as sales or commission-based work, your employer might want to see your tax returns to assess your earning potential and determine your compensation.
# Background Checks
In addition to credit reports, bank records, and tax returns, employers might also conduct a more comprehensive background check that includes other financial records. This can include records of civil judgments, liens, and bankruptcies, as well as information about your driving record and criminal history.
For example, if you're applying for a job that requires you to drive a company vehicle, your employer might check your driving record to make sure you have a clean record. Similarly, if you're applying for a job in a field where a criminal history could pose a risk to your employer or clients, your employer might conduct a criminal background check to assess your criminal history.
# Final Thoughts
Overall, a financial background check is an important part of the hiring process for many employers. By examining your financial records, employers can gain insight into your financial habits, assess your financial stability and responsibility, and determine whether you're a trustworthy candidate for the job. If you're applying for a job that requires handling money or working with sensitive financial information, it's especially important to ensure that your financial records are in good order and that you're prepared to answer any questions your employer might have.
