Social Security Debit Card- It's There When You Need It

A new program from the Social Security Administration allows Social Security recipients to get their monthly payments on a prepaid debit card last year. According to an article in US News & World Report, over half a million Americans have now signed up for the Direct Express Debit MasterCard offered by Dallas-based Comerica Bank. The card is aimed at Social Security recipients without bank accounts who use often expensive check cashing services to process their Social Security payments.

Damon Edgil, 32, of Birmingham, Ala., signed up to receive his Social Security Disability Insurance payments on the debit card two months ago and now uses it to pay bills online. Previously, Edgil used prepaid credit cards to pay bills, which charged him a $5 maintenance fee per month. Like Edgil, a whopping 95 percent of cardholders say they are satisfied with the card experience, citing convenience and immediate access to their money, according to a survey of cardholders by the U.S. Department of the Treasury’s Financial Management Service released this week.

Most Social Security recipients are using these cards to make retail purchases, ATM withdrawals, and to pay bills. “It’s easier to go use my debit card than to have to go to a bank and get cash,” says Jonathon Bynum, 35, of Monroe, Ga., who doesn’t have a bank account and signed up to receive his Social Security disability payments on the debit card last year. Only between 19 and 29 percent of cardholder’s have a bank account, according to David Lebryk, commissioner of the Financial Management Service. Read article: www.usnews.com/blogs/planning-to-retire/2009/07/24/social-security-debit-card-gains-traction.html