Social Security is the foundation of retirement planning for millions of Americans, and front-line banking professionals see firsthand the financial strategies that beneficiaries use to get the most out of the program.
Some of those strategies work, and some don’t. And far too many people don’t have any strategy at all.
To learn about the steps beneficiaries need to follow for success in retirement, GOBankingRates spoke with Brandon Stout, a relationship advisor with Addition Financial Credit Union in Lake Mary, Florida. At Addition Financial, relationship advisors are the equivalent of tellers — and Stout has seen many Social Security recipients make mistakes that cost them crucial financial security in retirement.
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Here are his top five tips for maximizing your benefits, minimizing mistakes and streamlining the process of dealing with the notoriously bloated and burdensome bureaucracy responsible for assessing and distributing your payments.
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Choose Direct Deposit
According to the Social Security Administration (SSA), “Federal law mandates that all federal benefit payments — including Social Security and Supplemental Security Income benefits — must be made electronically.”
Paper checks in the mail are a thing of the past, and today’s beneficiaries have two ways to collect their payments: The SSA can place them onto a Direct Express Debit Mastercard or put them into a bank or credit union account via direct deposit.
Stout suggested the latter.
“By opting in for direct deposit, you will have access to the entirety of your funds at the time of deposit,” he said.
The SSA agrees with Stout’s assessment and expands on the reasons, stating that direct deposit into a bank account is the safest, quickest and most convenient way to collect your benefits.
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Plan Out Your Month and Expect the Unexpected
Many retirees live on an income that’s fixed, but their expenses — and even the schedule on which they receive their benefit payments — might not be.
“Be prepared for the unexpected when it comes to when your benefits come in,” Stout said. “There are times when your Social Security payment might not get to you at the same time every month for whatever reason. Make sure you have budgeted correctly and have enough funds to sustain you until your check arrives.”
Check and Verify Your Application Information
When it comes to claiming Social Security, an ounce of prevention truly is worth a pound of cure. Applying for benefits can be challenging and frustrating, but correcting errors once you’ve already submitted them to a massive, sprawling governmental bureaucracy is a much bigger headache.
“When applying for Social Security, it can be easy for seniors with vision or memory issues to input incorrect information,” Stout said. “Take the time to sit with a loved one or trusted advisor to overview all banking information before submitting the application.”
Check for Payment Errors
In March, the SSA outlined the steps the agency was taking to address the overpayments and underpayments that it sometimes makes. Such instances are rare, but they happen — and if they happen to you, you could receive less than you’re owed or be required to send back an overpayment that you didn’t know you received and aren’t able to repay.
Therefore, it’s up to you to validate the accuracy of each and every payment you receive.
“Make sure to check all bank statements to ensure your monthly distribution amounts are correct,” Stout said. “If you notice any discrepancies, be sure to notify the SSA as soon as possible.”
Scammers and Fraudsters Want Your Benefits — Be Vigilant
The SSA dedicates a page of its website to outlining the many frauds that scammers use to separate Social Security recipients from their data and their dollars. Sometimes, they use the stick — threatening to seize your bank account or cancel your benefits if you don’t send money or update your private information. In other cases, they use the carrot, like promising to increase your monthly payment or reimburse you for previous underpayments.
No matter the tactic, the endgame is always the same — to steal your money or your personal information. Stout has seen these swindles — and their victims — firsthand.
“One issue I have seen and dealt with on behalf of my members repeatedly is the Social Security scam,” he said. “Dishonest individuals will pose as agents from the Social Security Administration and use scare tactics to trick you into giving them personal information like bank account numbers. If you have any concerns, please visit your local Social Security office, and speak with a representative in person.”
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This article originally appeared on GOBankingRates.com: I’m a Bank Teller: My 5 Top Banking Tips for Social Security Recipients
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