Social Security Going Paperless in 2013

The growing trend in American business today is for companies to go paperless.  Well, Social Security is catching up and will implement a move in that direction in the spring of 2013.  Beginning March 1, 2013, Social Security will no longer mail paper checks to beneficiaries.  Instead they will offer two options: direct deposit, and a Direct Express debit card.  While this change will not effect most Social Security recipients (about 90% already receive their funds via direct deposit), it will provide some convienences to those currently receiving checks.  Namely it increases security, as checks are no longer able to be intercepted en route, and increases reliability, as funds will no longer be delayed by bad weather (think hurricanes in the southern states). 

So, you might ask, how does this work?  Well, it's really pretty simple.  Social Security will send out a Direct Express debit card, and then load funds onto the card each month.  But, there are some downsides.  For example, there are some hidden fees to watch out for including a charges for each ATM withdrawal after the first one of the month.  Check out the links below for more details on some of these fees and restrictions.

The takeaway from all of this?  If you don't receive benefits via direct deposit, you might want to consider signing up before next March.

Summary Article

Things to Know About the Direct Express Debit Card

Social Security's Info Page

Social Security Cost of Living Increase Announced

After two years without a cost-of-living adjustment (COLA), Social Security has announced that recipients will receive a 3.6% increase in their checks beginning in January of 2012. In January of 2009, recipients received a 5.8% increase (an uncommonly large adjustment) but did not see any adjustments in 2010 or 2011. In each of those years the rate of inflation was too low to trigger a COLA. Since an increase in Medicare Part B premiums cannot lower a Medicare beneficiary's Social Security amount, there has also been a corresponding postponement in the increase of Part B premiums for existing Medicare beneficiaries. The Centers of Medicare and Medicaid Services (CMS) has not yet released the Medicare Part B premiums for 2012.

For more information see the Social Security announcement by clicking here.