Waiting for Social Security or any other federal benefit check to arrive in the mail will be a thing of the past as of March 1, 2013. The US Department of Treasury will be going all electronic via direct deposit.
The benefit to consumers is that electronic payments are safer, easier and more reliable than paper checks. Those who use direct deposit now recognize its easier knowing when the money is in the bank.
What does this mean for you?
For those not yet receiving federal benefits, know that when you apply you must receive the benefits electronically. That requirement began for new recipients on May 1 of 2011.
If you already have your federal funds direct-deposited nothing will change.
If you currently receive a paper check, you must switch to the electronic payment. This means providing a bank routing number and account number. People who do not select electronic payment option by the deadline will receive their benefits by Direct Express card (www.usdirectexpress.com/edcfdtclient/index.html ), which is a prepaid debt card that can be used for making purchases and access cash at an ATM.
The prepaid debt card has potential benefits as well as potential costs and concerns. If you don’t have an account with a bank or credit union this may be the time to shop for a low- or no-cost checking or savings account. Sometime financial institutions wave fees for customers who have regular direct deposits. Be ready for the change to all direct deposit of federal benefit checks.