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Government Encourages Local Seniors to Use Direct Deposit
By Bulletin staff writer
A
new survey has revealed a troubling difference between today’s
seniors and the next generation of retirees — one that could
have significant cost and security implications for Americans.
Among those ages 65 and older, the survey found that 72 percent use
direct
deposit. In contrast, only 59 percent of Americans ages 45-64 — the
bulk of the baby boomer generation — said they use it.
The nationwide survey, sponsored by the U.S. Department of the Treasury
and the Federal Reserve Banks as part of their Go Direct campaign, provides
a surprising twist on commonly held perceptions about these age groups,
especially in light of another finding that showed baby boomers are 20-25
percent more comfortable with technology than seniors. Go Direct, a national
campaign launched earlier this year, aims to inform more Americans about
the security, ease and convenience of using direct deposit for Social Security
and other federal benefits, and to encourage them to sign up.
“There is no safer way to receive Social Security than direct deposit,” said
Dick Gregg, commissioner of the Treasury’s Financial Management Service. “Last
year alone, half a million people reported problems receiving checks.
In stark contrast — and contrary to what 38 percent of those surveyed
believe — no direct deposit payment has ever been lost or stolen.
“Furthermore, if the trend with pre-retirees continues, the sheer
size of the 77 million baby boomer population — coupled with impending
postage increases — will drive up the government’s costs to
issue paper checks exponentially... and taxpayers will bear the burden.”
In November, the Bulletin interviewed several senior citizens in Compton regarding
direct deposit accounts and found that many of them, like Tony Hill, were not
only in favor of the Go Direct plan but in addition had their Social Security
and retirement checks deposited directly into their bank accounts. Many cited
convenience as one of the primary factors in choosing direct deposit. “I
travel a lot,” Hill said as he was finishing his lunch. Asked why he liked
having his check deposited directly into his account, he responded, “Because
you can get it anywhere... Anywhere,” Hill repeated.
“It’s very hard to have someone steal your check if you have direct
deposit,” he added with a smile.
Juanita Beamon, a retired nurse whose son works in law enforcement, advised her
to explore a direct deposit form of banking because of the prevalence of identity
theft. “My husband and I have it now after my son stressed the importance
of the safety aspect,” she said.
Nevertheless, apparently many seniors remain unresponsive to the Go Direct campaign.
Alvina McHale, a spokesperson for the Treasury Dept., told the Bulletin in November
her research showed initial positive response to the government-sponsored campaign. “We
have conducted a lot of research via interviews and the statistics point out
that most people who are interviewed like what they hear,” she reported.
To date, 31% of interviewees were somewhat likely to try Go Direct, 40% were
inclined to consider the program and 12% were neutral. “We think that those
are good numbers,” the treasury spokesperson said.
Why the resistance to direct deposit? According to the survey, among the 40 percent
of Americans who do not currently use direct deposit, there were three leading
reasons — 21 percent said they like to go to a financial institution to
deposit their check; 19 percent said they don’t trust direct deposit; and
18 percent said they like receiving a paper check.
“Direct deposit gives you far greater control over your money and time
than waiting
for a paper check to arrive each month,” Gregg said. “Come payment
day, you know your money will be safely in your account — on-time, every
time.”
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