It can be a challenge to make sure that your parents are well-taken care of as they get older—especially when you have to take into account their future care needs. There are so many different scenarios and situations to consider.
Financial security and well-being, however, is one of the most vital.
Social Security provides economic security for millions of Americans, from retirees to those who are disabled or widowed, and can help to give you much needed peace of mind when leaving your loved ones in the care of others. Not only will it assist in relieving some of the costs of in-home care, it can give your loved ones a much-needed sense of security, as well as the independence they desire.
What Is Social Security?
As a working adult, you probably only have a basic idea of what Social Security is about— it’s what you’re paying money into now with the promise of using it as a source of income after retirement.
You may not know that Social Security benefits are one of the most relied upon sources of income for not just retired workers, but survivors of deceased or disabled workers and their families. As Social Security is a pay-as-you-go program, today’s workers are funding Social Security through taxes deducted from their wages, which is then paid out to beneficiaries as monthly income.
Most important for you to know, as a caregiver, is that in 2011, The U.S. Department of treasury began phasing out paper checks for Social Security and other federal benefits.
And now, with the implementation of a new law that went into effect on March 1, 2013, it is now mandatory for Social Security benefits to be directly deposited in to a bank account. Beneficiaries without the necessary bank account can apply for a Direct Express card through which funds can be drawn each month.
Why Did This Change?
Simply put, the change was made to create a more reliable and secure system for dissemination of Social Security funds to those who receive monthly payments. Not only does this new system lessen the chance for the theft or loss of checks, but it creates a faster, more immediate method for funds to reach their destination.
The change also has financial benefits of its own. It is estimated that the switch to direct deposit will save taxpayers almost $120 million every year, resulting in over $1 billion in savings over the next decade.
What Is Direct Deposit?
For those unfamiliar with the term, direct deposit is the means through which money is electronically transferred into a specified account without the need for a physical document such as legal tender, check, or money order.
Setting up Direct Deposit
For those who receive monthly Social Security benefits, there are several ways to set up the direct deposit of funds. Your parents can choose to receive payments by direct deposit to a bank or credit union, or through the issuance of a Direct Express card account, which is a debit card that can be used to access benefits.
There are several ways to set up direct deposit if your loved ones are already receiving Social Security benefits:
- Contact your bank, credit union, or savings and loan association
- Call Social Security, toll-free, at 1-800-772-1213
- Fill out a Direct Deposit Sign Up Form, which will need to be taken or mailed to the appropriate Social Security Office
If your loved ones are not currently receiving their benefits, but will be applying in the near future, they will need to speak to a Social Security representative who will guide them through the process.
Do It for Their Peace of Mind and Yours.
Setting up direct deposit for your loved ones Social Security benefits is not just important, it’s necessary. For both compliance to the law and the peace of mind both you and your loved ones will have, knowing their Social Security benefits are safe, secure, and ready. That means less stress about figuring out how to pay for your parents’ expenses and more time to focus on setting up the future in-home care they deserve.