Social Security Shifts to All-Electronic Payments, Aiming to Cut Costs and Reduce Fraud

The Social Security program is facing a projected insolvency of its Old Age and Survivors Insurance trust fund by 2033, which could trigger automatic benefit cuts of around 23%. While lawmakers are debating solutions, including the possibility of raising the Full Retirement Age (FRA) beyond 67 for those born in 1960 or later, the SSA Commissioner clarified that raising the FRA is not currently under consideration. Meanwhile, a bipartisan bill aims to improve clarity around the retirement age wording to help beneficiaries better understand the impact of delaying claims on monthly payouts. Additionally, starting September 30, 2025, the SSA will stop issuing paper checks, requiring all beneficiaries to switch to direct deposit or a prepaid debit card, a move intended to reduce fraud and save costs since fewer than 1% still receive paper checks. This shift affects more than half a million recipients who must enroll in electronic payments to avoid missing benefits. The retirement age debate highlights concerns for those in physically demanding jobs and lower-income workers, while supporters argue that increased life expectancy justifies the change to maintain program solvency.