Social Security Debit Card - 8/01/08
Intro: More than 80% of Social Security Recipients have their monthly checks directly deposited into their bank accounts. But the other 20% prefer the old fashioned paper checks. And of those, 700,000 checks were lost or stolen last year alone. Now there's a new program to make it easier and safer for retirees to receive their Social Security checks. Here to explain is Attorney Mike Solomon.
Jeff: What's the new program to make Social Security benefits safer?
Mike: The Government will now provide to retirees a Direct Express Debit Master Card which has their social security payment right on it. The program just started this month and is being rolled out through the country. It is now available in Ohio.
The program was designed for people who don't have bank accounts and can't have their payments directly deposited in a bank account, to keep their payments safe. But anyone can use the program.
Jeff: If you already have your check directly deposited to the bank, are there reasons to switch to the Debit Card?
- Social security recipients can access their money at any ATM machine nationally, stores and banks. This means you are not limited to your bank for cash.
- You can make purchases without writing a check.
Jeff: Is the debit card safe?
Yes and no.
- First, your money on the debit card is FDIC issued.
- However remember if you lose your card you can have some liability potentially. The cards will have a pin number so that makes it harder for someone to access your account. If you lose your card and inform the card company within two days of discovering the loss, then your loss is limited to $50. If you dispute the charge within 90 days after you find out the card is lost, your liability is limited to $500. Master Card may waive some of this liability in certain situations.
Jeff: Many people on social security have to watch every penny they spend. Does the debit card cost money?
Mike: There are some free services, and some features cost money
Here is what is free:
- There is no cost to sign up and no monthly fee.
- Cardholders can get free cash back with purchase at certain retail locations that accept the Master Card debit card or free cash withdrawals from most banks and credit unions.
- Once a month you can make a free ATM withdrawal from certain ATM machines, such as Master Card. For example, I went on the web site and there are 10 ATM machines around downtown Cleveland that can be accessed for free.
Other services such as additional withdrawals each month from an approved ATM can cost .90 cents per withdrawal.
The government plans on eventually offering debit cards for other government benefit programs. This is just another step in the government reducing paper transactions which, moves things quickly and saves millions of dollars in administrative costs.
Jeff: Thank you.