NORMAN — Dear Savvy Senior,I have received my Social Security check in the mail every month for more than 25 years, and now I’m told I have to switch to direct deposit. Do I have any options?
If you’re over age of 90, or live in a remote area you may still have the option of receiving your Social Security checks in the mail if you want. Otherwise, you have until March 1, 2013, to switch from paper benefit checks to direct deposit. Here’s what you should know.
Mandatory direct deposit
The reason the U.S. Department of Treasury is phasing out paper Social Security checks and replacing them with electronic delivery is because it’s cheaper, safer and more reliable. About 93 percent of federal benefit recipients already receive their payments via direct deposit. Switching most of the remaining 7 percent to paperless payments is expected to save Social Security around $600 million over the next 10 years in postage, paper and printing costs. The switch also will eliminate the potential problem of checks that get lost in the mail or stolen.
Therefore, anyone who is currently receiving their Social Security, SSI, veterans, railroad retirement or federal civil servant retirement benefits in the mail, will need to switch to direct deposit either into a bank account or credit union of their choice, or a Direct Express Debit MasterCard by March 1, 2013.
The only exceptions are for elderly seniors born before March 1, 1923, mentally impaired people and recipients who live in remote rural areas. They will still have the option of receiving their government benefits via paper check if they wish.
Debit card option
If you don’t want your government benefits direct deposited in your bank account, or if you don’t have a bank account that your payments can be deposited into, you’ll need to get a Direct Express Debit MasterCard. This is a prepaid debit card that was introduced by the Treasury Department back in 2008.