For the first time in many years Social Security is making a major change in how seniors and others who qualify for Social Security receive their income checks. While this may take getting used to for some, the benefits far outweigh the minor inconveniences of the change. Social Security Benefit recipients will no longer have to worry about waiting for their paper check in the mail, rushing to the bank to pay bills, or worse, the money just not showing up. When people depend on this income to live month to month these problems can be devastating. In fact, according to the United States Department of the Treasury, 1.3 million people per year report issues with paper checks, 540,000 Social Security checks were reported lost or stolen in 2010, and nearly 50,000 checks were altered or fraudulently endorsed in 2010. The U.S. Department of Treasury is taking a proactive step to make receiving federal benefits quicker, safer and more convenient with a new rule that all beneficiaries must “Go Direct” by March 1, 2013.
What it means to “Go Direct?” Put simply, all persons receiving federal benefits will receive them in the form of electronic payment. Each individual has their choice to receive their benefits via direct deposit or the Direct Express card.
Direct Deposit: The direct deposit option gives the recipient more control and quicker use of their benefit check because the funds are deposited into their bank account at the same time every month and available immediately. Direct deposit provides many benefits including: preventing lost, forged or stolen checks; eliminating the need to go to the bank to deposit your check; removes the possibility of late delivery of benefits, and drastically reducing issues concerning Social Security payments. For those who do not have a bank account the Direct Express card is a great alternative.
The Alternative: If a person chose not to take advantage of the direct deposit option the Direct Express card functions the same as a debit card, without the need for a bank account. Similar to direct deposit, monthly payments are automatically deposited into the cardholder’s account and available immediately. The card can be used to withdraw cash, make purchases or pay bills online. The card is FDIC insured and PIN-protected for added security. The Direct Express card provides many of the same benefits as direct deposit. However, the card will come with added fees including: $0.90 fee for more than one cash withdrawal per month (per transaction); surcharges at certain ATMs; $0.50 for each online bill payment; $0.75 fee to receive a paper statement; and a $4.00 card replacement fee (one replacement is given free per year). See the complete list of fees from www.usdirectexpress.com.
Benefits of “Go Direct”
- Fast, safe, secure and convenient delivery of social security and federal benefits.
- Reduction of issues, including fraud or loss, with Social Security Payments
- Saves us money. The US Treasury will save taxpayers approximately $130 million per year, or over $1 billion over the next ten years, most of which would remain in the Social Security Trust Fund.
- Go green. This change will also save trees, or about 12 million pounds of paper in the first five years.
How to “Go Direct”
Direct Deposit: www.godirect.gov or by calling (800) 333-1795, or visit your local bank/credit union branch or contact your local SSA office.
Direct Express Card: www.usdirectexpress.com or call (888) 544-6347 or notify your local SSA office.
Important Dates:
May 1, 2011 – Persons applying for benefits after this date will be required to receive their payments electronically via direct deposit or the Direct Express card.
March 1, 2013 – Persons currently receiving benefits must chose direct deposit or Direct Express card option by this date. Failure to enroll in either of these options will result in a default selection of the Direct Express card.
Stefans Law Group, P.C. and Stefans Associates, Inc. are always a fan of any efforts to go green, especially when it will ultimately put money back in
