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The United States Government has recently initiated a new effort to encourage Social Security and other federal benefit recipients to receive their benefits via direct deposit into their bank accounts. Go Direct is a national campaign to motivate more Americans to select direct deposit for their federal benefit payments, such as Social Security and Supplemental Security Income (SSI). This campaign is being sponsored by The U.S. Department of the Treasury and the Federal Reserve Bank.

Why is the government promoting direct deposit?

Direct deposit is safer than mailing checks. No direct deposit payment has ever been lost or stolen. It’s easier than checks, because people who get benefits don’t need to go to the bank or credit union to deposit a check. Their payment goes straight to their account on payment day each month, giving people more control over their money. It’s simple to sign up for direct deposit – it just takes a few minutes to enroll by phone or in person at a Go Direct event, bank or credit union, or a local Social Security office.

Why should taxpayers care about direct deposit?

Direct deposit represents a significant savings over paper checks – 75 cents per federal benefit payment. The Treasury issues approximately 160 million benefit checks annually. If all those were converted to direct deposit, it would save taxpayers about $120 million annually.

What will happen when baby boomers start retiring?

Unless the rate of direct deposit use increases, the costs associated with issuing federal benefit checks will balloon when baby boomers start retiring in 2008. These costs include printing and mailing fees, as well as money spent on claims and problem resolution. The Treasury recognizes that it is important to take action now to increase the growth trend of direct deposit.

Why would direct deposit work better for me?

How does direct deposit work?

With direct deposit, the Treasury electronically transfers a payment into a beneficiary’s checking or savings account. There’s no check involved, and the payment is there when the individual’s bank or credit union opens on payment day.

Fast Facts About Direct Deposit

1. It costs 75 cents more to mail a federal benefit payment check than to issue an electronic payment.  The government mails approximately 160 million benefit checks each year, at a cost of about $120 million more than the cost of direct deposit.
2. The government has saved $5 billion since 1986 due to direct deposit.
3. Direct deposit is significantly safer than checks – in fact, no direct deposit payment has ever been lost or stolen.  You are 30 times more likely to have a problem with your check than with your direct deposit payment.
4. In 2004, more than 70,000 checks issued by the U.S. Department of the Treasury were forged.  The checks totaled more than $61 million.  Check fraud and identity theft are growing risks for all Americans.
5. Currently, almost 50 million people receive Social Security payments each month.  Social Security recipients are the largest group to receive government payments.  By promoting direct deposit today, the government is planning ahead for the first wave of baby boomers that will become eligible for retirement in 2008.  There are about 77 million baby boomers – individuals born between 1946 and 1964.
6. Benefit recipients who use direct deposit can access their payments as soon as their bank or credit union opens on payment day.