THE Social Security Administration has confirmed a major policy u-turn affecting millions of Americans.
Changes that had been due to come in from September are now being rowed back.
USA Social security cards laid on pile of dollar bills[/caption]
The SSA has now revealed it will continue to send paper checks to certain recipients after all[/caption]
In a bid to modernize systems, the SSA had planned to end the use of paper checks for benefit recipients in favour of electronic payments.
The seismic change had been set to take effect on September 30.
But the SSA has now revealed it will continue to send paper checks to certain recipients after all.
The agency told CBS MoneyWatch that those who have no other means of getting payments will still receive their checks this way.
However, a spokesperson also told the broadcaster that the advantages of electronic transfers will be emphasized in a bid to encourage people to switch.
Eliminating paper transfers has been estimated to save the federal government a considerable sum of money.
The agency previously said that paper checks cost 50 cents each, as opposed to 15 cents per electronic transfer.
Democrat Senator Elizabeth Warren had met with Social Security Commissioner Frank Bisignano to discuss the discontinuation of paper checks.
“There are about 600,000 Americans who still receive their paper checks.
“It’s a small fraction of people who receive Social Security payments, but it’s a population that often needs checks through paper,” she said following the meeting.
Around 70 million Americans are reported to receive Social Security benefits.
It comes as American retirees could face an automatic slash to Social Security checks of 24 per cent if the trust fund dries up.
A nonpartisan committee has moved up the insolvency timeline for Social Security’s trust fund to just less than a decade away.
Analysis from the Committee for a Responsible Federal Budget makes for troubling reading.
The report has updated fiscal projections following the passing of President Trump’s One Big Beautiful Bill Act.
It could see Social Security’s trust fund insolvency as soon as late 2032, Fox Business has reported.
“Policymakers pledging not to touch Social Security are implicitly endorsing these deep benefit cuts for 62 million retirees in 2032 and beyond,” the committee says.
