Social Security Administration Ends Paper Checks

According to the Whidbey News Times, the Social Security Administration is entering a new age – the agency is set to go paperless beginning May 1. Social Security checks are going paperless, as the U.S. Treasury Department retires paper checks for electronic payments.

The Treasury Department said this is a cost-saving measure, which will not be fully implemented until May 2013. The new system plans to reduce government expenses by $1 billion over the next decade as millions of individuals apply for monthly Social Security benefits. Disabled individuals enrolled in the Social Security Disability Insurance or Supplemental Security Income will start receiving electronic deposits into bank accounts or debit cards.

Eighteen million baby boomers are expected to start drawing out monthly Social Security payments in the next five years, which would offer further cost-saving to the administration.

Direct deposit has long been an option for Social Security Disability Insurance recipients and others, and in fact, most recipients of federal checks already receive electronic payments. Currently, 11 million people still receive benefits from the government through the mail. Some do not have bank accounts or simply do not trust large financial institutions.

Individuals receiving benefits will have a choice of having payments directly deposited into a bank or credit union account to have the money loaded onto a prepaid debit card. For individuals who have no bank accounts, the Direct Express will be available as an alternative and the card is easy to use at most places.


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