Paper checks will gradually become more and more defunct over the next few years for recipients of entitlement programs as the federal government transitions to paying people electronically for Social Security and other benefits, the Department of Treasury said Tuesday in a press release.
Those that apply for benefits on or after May 1 next year will automatically receive their checks electronically, while those already enrolled in benefits programs will need to sign up for direct deposit by March 1, 2013.
“Eight in ten federal benefit recipients already use direct deposit, and now millions of additional retirees, veterans, and other Americans will also receive their money in the safest, most reliable way—electronically,” Treasury Fiscal Assistant Secretary Richard Gregg said in a statement.
The Department of Treasury’s Financial Management Service said that the new change would save hundreds of millions of dollars a year.
“This important change will provide significant savings to American taxpayers who will no longer incur the annual $120 million price tag associated with paper checks and will save Social Security $1 billion over the next 10 years,” Gregg added.
According to the Washington Post, the replacement of paper checks will affect nearly 140 million recipients of benefits from four federal agencies: the Social Security Administration, Department of Veterans Affairs, Office of Personnel Management, and Railroad Retirement Board.
Those that apply for benefits on or after May 1 next year will automatically receive their checks electronically, while those already enrolled in benefits programs will need to sign up for direct deposit by March 1, 2013.
“Eight in ten federal benefit recipients already use direct deposit, and now millions of additional retirees, veterans, and other Americans will also receive their money in the safest, most reliable way—electronically,” Treasury Fiscal Assistant Secretary Richard Gregg said in a statement.
The Department of Treasury’s Financial Management Service said that the new change would save hundreds of millions of dollars a year.
“This important change will provide significant savings to American taxpayers who will no longer incur the annual $120 million price tag associated with paper checks and will save Social Security $1 billion over the next 10 years,” Gregg added.
According to the Washington Post, the replacement of paper checks will affect nearly 140 million recipients of benefits from four federal agencies: the Social Security Administration, Department of Veterans Affairs, Office of Personnel Management, and Railroad Retirement Board.
