Social Security's Money-Saving Strategies

The Social Security Administration is cutting some services due to budget cuts.

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The Social Security Administration adopted a variety of austerity measures this year. To save money, SSA is closing offices early, switching to paperless payments, and reducing the number of informational mailings it provides. "Congress provided our agency with nearly $1 billion less than the President requested for our budget this fiscal year, which makes it impossible for us to provide the amount of overtime needed to handle service to the public as we have in the past," says Michael Astrue, Commissioner of Social Security. Here's a look at some of the services that have recently been reduced or eliminated.

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Closing early. Beginning on August 15, Social Security field offices nationwide will close 30 minutes early each day. Offices that are usually open from 9 a.m. to 4 p.m. on weekdays will close daily at 3:30 p.m. "While agency employees will continue to work their regular hours, this shorter public window will allow us to complete face-to-face service with the visiting public without incurring the cost of overtime for our employees," says Astrue.

Paperless payments. The Treasury Department eliminated the option for new Social Security beneficiaries to receive paper checks beginning May 1, 2011. Social Security recipients must now have their payments directly deposited into a bank or credit union account or loaded onto a Direct Express Debit MasterCard. Paperless payments are expected to save taxpayers $1 billion over the next 10 years. People currently receiving their federal benefits by paper check must switch to direct deposit by March 1, 2013.

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Suspended statements. The Social Security Administration elected to stop mailing annual Social Security statements to workers to save money this year. Suspending mailings for all workers over age 25 is expected to save approximately $30 million in fiscal year 2011 and $60 million in 2012. Some of the information provided in these four-page mailings is available online. For example, you can get an estimate of your retirement benefits online using SSA's retirement estimator tool. However, other facts contained in the statements, such as the approximate amount you will get each month if you become disabled, how much your family will receive if you pass away, and a complete record of your earnings and taxes paid are no longer readily available to taxpayers. SSA plans to eventually resume mailing statements to people age 60 and over and make statements available to people of all ages online, but has not set a definitive date about when this information will become available. "If you have your statement, hold on to it," advises Steve Sass, a research associate at the Center for Retirement Research at Boston College. The information contained in these statements can be useful in determining your future retirement payout and to check your recorded income for errors.

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Promoting online services. The Social Security Administration has aired a series of celebrity-studded Social Security public service announcements over the past two years encouraging retirees to sign up for Social Security online. Astrue estimates that the increase in online applications resulting from the advertisements starring Patty Duke, George Takei, and Chubby Checker has saved SSA between $25 million and $30 million. In keeping with its money-saving goals, none of the celebrities were paid for their endorsements, no television time was purchased to run the advertisements, and the scripts for the public service announcements were written by existing SSA employees.

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