A Big Social Security Change Is Coming on Sept. 30. Here's What Retirees Need to Know.

Key Points

• The Social Security Administration will eliminate paper checks at the end of September.

• Retirees have two electronic payment options.

• Another big Social Security change is on the way soon, too.

• The $23,760 Social Security bonus most retirees completely overlook ›

Most retirees are quite accustomed to change. After all, they've lived through a lot of changes over the years. And things certainly don't stay the same after leaving the workforce.

They should get ready for another adjustment. A big Social Security change is coming on Sept. 30. Here's what retirees need to know.

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The end of an era

Monthly Social Security checks have been around since January 1940, less than four and a half years after the Social Security Act was signed into law by President Franklin D. Roosevelt. Millions of American retirees through the decades looked forward to seeing those checks arrive in their mailboxes.

But the end of an era will come on Sept. 30, 2025. That's when the Social Security Administration (SSA) will stop issuing paper checks for monthly benefit payments. The agency will switch to only electronic payments. Why is SSA making this change? It wants to improve efficiency and security -- and, perhaps most importantly, save money.

Using electronic funds transfers (EFTs) instead of paper checks to pay monthly benefits will reduce SSA's processing time. This means Social Security beneficiaries will receive their payments more quickly. EFTs offer a more secure payment method than paper checks. SSA stated, "Paper checks are 16 times more likely to be lost or stolen compared to electronic payments, increasing the risk of fraud."

Eliminating paper checks will also cut costs. The U.S. Department of the Treasury estimates that issuing one paper check costs around 50 cents compared to only 15 cents for processing an EFT. Converting to electronic payments could save the U.S. government millions of dollars each year.

What retirees need to do

Most retirees won't have to take any action regarding SSA's big change, which is scheduled to take effect at the end of this month. That's because less than 1% of Social Security beneficiaries currently receive paper checks.

Retirees who have been getting paper checks should have already received a notice from SSA explaining the looming change. The agency has also included inserts with benefit checks that explain what steps should be taken to switch to electronic payments.

The good news is that making the switch is simple. Retirees have two electronic payment options from which to choose:

• Direct Deposit. This option will enable Social Security payments to be deposited directly into retirees' checking accounts or savings accounts each month.
• Direct Express Card. This option is for Social Security beneficiaries who don't have a bank account. It's a prepaid debit card for receiving federal benefit payments.

Retirees can pick one of these two electronic payment options through their personal my Social Security account online. They can also get more information by going to www.ssa.gov/deposit/ or by contacting a local Social Security office.

Another Social Security change coming soon

The elimination of paper checks isn't the only Social Security change that's on the way. Another Social Security change is coming soon. It's one that many retirees eagerly anticipate: the announcement of the 2026 Social Security cost-of-living adjustment (COLA).

SSA is expected to announce what next year's COLA will be on Oct. 15, 2025. That's the magic date because it's when inflation data from September will be released by the U.S. Department of Labor Statistics (BLS). SSA uses one of the inflation metrics in BLS' monthly update -- the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) -- to calculate the annual COLA.

The Senior Citizens League, a nonprofit organization that advocates for seniors, projects that the 2026 Social Security COLA will be 2.7%. If this prediction is correct, next year's COLA will be slightly above the average over the last 20 years.

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