Most people no longer fetch their federal benefit payment checks from their mailboxes. The money is deposited directly into their bank accounts.
Millions more people will receive electronic payments after March 1, like it or not. That’s the date when all paper checks will convert to direct deposits or debit cards for benefits paid by the Social Security Administration, the Department of Veterans Affairs, the Railroad Retirement Board, the Office of Personnel Management and the Department of Labor’s Black Lung program.
People born on or before May 1, 1921, are exempt from the conversion, and waivers will be considered for those who have mental impairments or live in remote areas not served by banks or credit unions.
Payment recipients cannot say they were not warned. The U.S. Treasury has been pushing electronic benefit payments since 1996 and mailing conversion instructions with benefit checks. The Direct Express debit card was introduced in 2008, and all new benefit recipients since May 1, 2010, have been paid electronically.
A Treasury website indicates that debit cards will be sent to recipients who do not meet the conversion deadline. But Treasury spokeswoman Tepricka Morgan said the issuance of checks after March 1 is a possibility.
Benefit recipients are going to get their payment. Now, that mechanism that will get them that payment is still under consideration, Morgan said during a telephone interview.
Regardless of the mode, they will get a payment come April 1. It will not be interrupted, she said.
The Treasury will send letters to people who miss the deadline reminding them of the conversion. And a Treasury official told the New York Times that procrastinators will continue to receive paper checks.
Morgan said 93 percent of Social Security and Supplemental Security Income benefit recipients had made the switch as of November, leaving the Treasury with 5 million checks to mail each month for those federal benefits.
The Indiana compliance rate is a tad higher, at 94 percent, and Allen County is at 95.3 percent compliance. Still, that means the Treasury has been mailing nearly 83,000 monthly checks to Hoosiers for Social Security and SSI benefits.
Financed by payroll taxes, Social Security pays full retirement benefits to people starting between ages 65 and 67, depending on the year a person was born. The average monthly payment this year is expected to be $1,261 for a single recipient and $2,048 for a couple.
Supplemental Security Income is funded by general tax revenue and pays low-income people who are 65 or older or are blind or have disabilities. The SSI standard monthly payment this year is $710 a person and $1,066 a couple.
The Treasury has embarked on a recent media blitz in a bid to reach conversion procrastinators. How effective it is will be known after March 1.
We haven’t heard much directly, which troubles me a little bit and gets me thinking that maybe it’s not as widely known as it needs to be, said Katie Moreau, communications director for Indiana AARP, an advocacy group for people 50 and older.
Moreau said AARP has been notifying its members about the conversion through Facebook, Twitter and senior lifestyle publications.
She said the approaching deadline reminds her of the mandatory digital conversion for television broadcasters in 2009.
At some point, you just have to cut the cord and say, This is when it’s happening.’ You’re always going to have people who don’t get the word, she said.
The Treasury has promoted electronic payments as being safer, more convenient and less expensive than paper checks. AARP’s Moreau said 540,000 Social Security checks were lost or stolen in 2010.
Sen. Joe Donnelly, D-Ind., a member of the Senate Special Committee on Aging, endorses the switch.
Joe supports cutting government spending, and this change will save $1 billion over the next 10 years. It costs about one dollar to produce and mail each check, Elizabeth Shappell, communications director for Donnelly, said in an email.
People who already receive their benefit payments through direct deposit or debit card do not have to sign up for the conversion.
The Direct Express Debit MasterCard, issued by Dallas-based Comerica Bank, does not charge sign-up or account fees and offers a free ATM cash withdrawal with each deposit to an account. There are fees for further ATM withdrawals, monthly paper statements, card replacements and other optional services.
Among the states with the lowest electronic conversion rates for Social Security and SSI payments are West Virginia, where nearly 11.8 percent of benefit recipients still received checks as of November; Mississippi, nearly 11.4 percent; and Louisiana, 10 percent.
Morgan said that studies, including by the Federal Deposit Insurance Corp., have shown that Southern states have a higher percentage of federal benefit recipients who do not have bank accounts.
ConversionHere is how to switch federal benefit payments from a paper check to direct deposit or Direct Express debit card:
Call toll-free 1-800-333-1795, visit www.GoDirect.org or contact your federal benefit agency office.
Have available your Social Security number or claim number, 12-digit federal benefit check number and the payment amount of the most recent check.
For direct deposit, a recipient must provide a financial institution’s routing transit number, account number and whether the account is for checking or savings. The routing transit number appears at the bottom left of a check, and the account number is at the bottom center.
People seeking waivers because of a mental impairment or the lack of access to a financial institution should call 1-800-333-1795.
At a glance
|Monthly benefit payments made by Social Security and Supplemental Security Income, as of November:|
|Source: U.S. Treasury|