Don't wait for Social Security check in the mail

[Rhiannon12866]

Source: Business Week

WASHINGTON

Starting next year, the check will no longer be in the mail for millions of people who receive Social Security and other government benefits.

The federal government, which issues 73 million payments a month, is phasing out paper checks for all benefit programs, requiring people to get payments electronically, either through direct deposit or a debit card for those without a bank account.

The changes will affect people who get Social Security, veterans' benefits, railroad pensions and federal disability payments. Tax refunds are exempt, but the Internal Revenue Service encourages taxpayers to get refunds electronically by processing those refunds faster than paper checks.

About 90 percent of people who receive federal benefits already get their payments electronically, the Treasury Department says. New beneficiaries were required to get payments electronically starting last year, and with a few exceptions, the rest will have to make the switch by March 2013.



Read more: http://www.businessweek.com/ap/2012-04/D9U5M6RO0.htm

---

I wonder how popular this will be...

[elleng]

1. Some will certainly complain;

change is always problematic.
It works for me, ALWAYS on time. USPS has 'lost' and delayed a couple of my important letters, including a big check.
(P.S., I LOVE and appreciate USPS, and don't want them to be down-sized, as Congress has planned.)

[freshwest]

2. Same story here on all points.

[RebelOne]

25. Yes, I have had a problem with the USPS

delivering my mail to the wrong person. I live in a mobile home park with a central mail box for all residents. Several times, my mail has been put into the wrong box. But I have had my SS checks electronically filed into my bank account since I started receiving SS. I wouldn't have it any other way.

[CaliforniaPeggy]

4. I already get mine electronically, and I LOVE it.

[starroute]

5. Many people who have no bank account will get hit with debit card fees

The article says the debit cards can be used at stores with no charge, but every cash withdrawal after the first one each month will cost 90 cents -- and every ATM use may also be hit with a fee from the bank or other provider of the ATM. (Which can range from zero up to a couple of dollars, depending on where you go.)

For an elderly person with no bank account who is used to just cashing their check and making many small cash purchases, that's going to be hell. Not to mention that many stores don't accept an ATM card for a purchase under $5 or $10. Or that elderly people whose memories aren't what they used to be may have trouble remembering a PIM -- or where they put their card.

I understand why they're doing it, but I don't believe they've thought through the consequences, and much of this just seems like unnecessary cruelty.

[naaman fletcher]

12. I don't understand..

You say "The article says the debit cards can be used at stores with no charge, but every cash withdrawal after the first one each month will cost 90 cents",

but what does someone with no bank account who gets a social security check do now? They can't use that check to walk around and buy stuff with. They must get it cashed.

[elleng]

16. Details

—Those without bank accounts will be issued a Direct Express debit card, which will receive payments and can be used for purchases at retail stores and for cash withdrawals at ATMs.

—There will be no fees for debit card purchases but there will be fees for some ATM transactions.

http://www.nytimes.com/aponline/2012/04/16/us/ap-us-no-more-checks-glance.html?hp

edit:
'in 2010, more than 540,000 federal benefit checks were reported lost or stolen. The switch will save the government about $120 million a year. Social Security will save $1 billion over the next decade, according to the Treasury Department.'
http://www.businessweek.com/ap/2012-04/D9U5M6RO0.htm

[patricia92243]

24. Get all the cash at once - the same way you would cash the check and get all cash. n/t

[LiberalFighter]

28. Exactly

Otherwise, get a bank account maybe at a credit union might be more economical.

I wonder how many receive their check keep what is left over stashed at home?

[JDPriestly]

6. Electronic transmission of Social Security checks makes

electronic surveillance of where the money goes -- where seniors are spending it -- so much easier.

I hate the whole electronic accounts thing. I try not to access accounts over the computer. It's not that I am buying anything remarkable. In fact my life is quite boring. It's just that anyone can snoop on your computer, what you say, what you write, where you spend your money. There is no privacy any more.

I love the Post Office.

[jeff47]

7. Not really

Can still withdraw cash and use that.

Any other method of payment, including writing a paper check, leaves an electronic trail.

[Liberty Belle]

8. Mom's 83 and refuses to do electronic banking, worried about theft.

She will FREAK when she hears this. She's absolutely adament about not wanting any of her bank account info online. She's had arguments when opening new accounts about this - doesn't want to access statements online, insists that they mail her hard copies.

I think it's so wrong to force this on people who don't want it. A lot of older folks get stressed easily and stew over stuff like this...If they want checks they should be able to have them.

While I'm less paranoid than Mom and do plenty of credit card transactions online, I refuse to do Paypal having tried it once and been defrauded thankfully only for a small sum. Nobody has a right to know my bank account but me, PERIOD.

[mwooldri]

19. If she knows how checks work these days...

...then that might also freak her out. Write a check at the grocery store (or the dwindling number of places that take checks) ? They're often converted into a one time electronic draft. That paper check doesn't get any further than the stores' vaults and often get shredded. Pay a utility bill by check in the mail? They do that too.

Oh, and once a stranger has a check you wrote, the routing and account numbers can easily be lifted from the check and fake checks and fake electronic drafts can take place.

And since each and every single check goes through the Federal Reserve, the government already knows your bank details. Makes sense to me for those getting the Social Security check in the mail now - and who have a bank account - to have it direct deposited, and make that the only direct deposit they have.

Checks in paper form are going to become increasingly rare. I foresee a day that the only paper checks that are in circulation would be official checks and money orders. Personal checks will soon be a thing in the past.

Sadly, I feel that my April Fools joke I played on my peers at work may well come true. I joked that the company I work for are trying out embedded chips into the wrist, and that they work like the RFID contact-less chip cards that are presently out there and that my employers issue on selected cards. Wave your wrist at a reader and your purchase is made. If *THAT* ever becomes mandatory then I'll get into the business of making tin foil gloves.

[Remmah2]

22. My mom has had the same bank account since 1960, same bank, same location.

She still pays her utility bills at the local pharmacy in cash. She's never had an e-mail address, nor has she had Internet at the house. She's never been on a computer, never owned a cell phone.

She's modern though, she has a push button phone. She still has the old rotary phone in the basement.

[pinto]

9. Simpler & safer -

"Henderson (director of the Treasury Department's electronic funds transfer division) said electronic payments are safer and more efficient than paper checks; in 2010, more than 540,000 federal benefit checks were reported lost or stolen. The switch will save the government about $120 million a year. Social Security will save $1 billion over the next decade, according to the Treasury Department."

For those who choose to use cash, it seems feasable to make one free withdrawal of the entire benefit payment each month and go on as before.

And, as mentioned in the article, 90% of those receiving federal benefits already do so electronically. I hope the feds work to ease the other folks into the new system of payments.

[Rhiannon12866]

10. The thing is, a lot of seniors won't like it and may get all confused

I had a hell of a time getting my grandmother to get an ATM card after the bank was closed on Good Friday so she couldn't get cash to shop for groceries...

I'm also wondering how much this will cost the Post Office.

[elleng]

11. Won't 'cost' the Post Office anything,

as Congress has taken care of that.

[Rhiannon12866]

13. I know, and folks depend on it

Dawned on me that the Postal Service predates baseball, if not apple pie.

[elleng]

14. I somehow suspect that Ben Franklin had some kind of apple pie,

but surely not baseball. Maybe something 'similar?'

[Rhiannon12866]

17. My point is that it's an American institution that folks depend on

Especially seniors. My mother and her neighbors call each other if the mail is late.

[elleng]

18. Got it.

It is indeed an American institution, and must continue. At the same time, I appreciate what Soc. Sec./Treasury is doing. It appears they're aware of the problems and concerns, and are trying to resolve them.

[elleng]

15. *Details of Government Switch to Paperless Payments

How the changes in delivering Social Security and other government benefits will work:

—By March 1, 2013, nearly everyone will be required to receive their payments electronically, mainly through direct deposit into a bank account.

—Those without bank accounts will be issued a Direct Express debit card, which will receive payments and can be used for purchases at retail stores and for cash withdrawals at ATMs.

—There will be no fees for debit card purchases but there will be fees for some ATM transactions.

—Beneficiaries who are age 90 or older won't be required to make the change.

http://www.nytimes.com/aponline/2012/04/16/us/ap-us-no-more-checks-glance.html?hp

edit:
'in 2010, more than 540,000 federal benefit checks were reported lost or stolen. The switch will save the government about $120 million a year. Social Security will save $1 billion over the next decade, according to the Treasury Department.'
http://www.businessweek.com/ap/2012-04/D9U5M6RO0.htm

[madrchsod]

20. my check hits the bank one minute after 12 every month

[anti-alec]

21. I get SSDI

and went EFT a long ago. Debit card is a rip-off for the poor.

[TahitiNut]

23. Banks *LOVE* the 'float' ... an enormous bolus of cash.

Social Security funds are credited to the banks in advance of the beneficiary's ability to access it. Banks can use those funds, interest-free, and adore the riches. 'Float' is the Holy Grail of banking ... something a bank VP would almost kill for. On top of this, even as those funds are credited to the beneficiary, the beneficiary is given NO interest (or low interest) on those accounts. The Direct Express debit card is almost a "license to steal" ... having onerous fees if the account holder isn't cautious about the use of the card.

[Peace Patriot]

27. Criminy, I didn't know about this "float" money (billions) for the banksters!

Thanks for the info! Yes, this is a "privatization" scheme as I suspected. It is, first of all, forcing people to use private banks and private ATMs--if they can. Rural folks, the elderly and others sometimes cash checks at the local store and never see a bank or an ATM and may or many not have transportation to one. Some have no internet access, so the whole electronic banking scheme is not available to them. The elderly and the mentally disabled are particularly vulnerable on this point. They may have no experience with e-systems at all.

Your point is very enlightening. It's not just the fees--which we know damn well the banksters will find a way to charge. And it's not just the excluded groups (the above). It's the USE OF OUR MONEY for PRIVATE GAIN before we ever see it! I had no idea! What a scam!

[bemildred]

26. Thus eliminating more good government jobs in the name of "efficiency". nt

[Rhiannon12866]

29. I look at it that way, too...

And I predict a whole lot of senior citizens aren't going to like this one bit.

[bemildred]

30. It let's you know what they really think about good jobs.

Except for them and their friends, of course.