I guess they open an account with local banks or just use ATM machine to withdraw their moneys...

Direct deposit to USAA Fed'l Savings Bank and ATM w/d's.
M (SMdA, Gto., MX)

Hi brookwood, do you know that Medicare does not cover you when you live outside of the US? You probably do but just wanted to mention it just in case you didn't.

If I lived outside of the USA I too would have a checking account with USAA Savings Bank as mikemo suggested. Your Social Security check could have a direct deposit to your checking account and USAA allows something like 10 (or is it 15) ATM withdrawals without any charge. If you are charged USAA credits the charges back to your checking account.

I have no interest in it, but a friend does.

Unless things have changed, I believe that USAA services are available only to active and retired members of the US uniformed services including reserves, their spouses and children.

USAA banking services were open to all, but as of 30 June that changed back to only Mil & retired & their kids.

We're not getting SS checks yet (if we ever do), but we'd have them deposited into our U.S. bank account. We might open an account at one of the American banks with many branches overseas (like Citibank) or perhaps a British bank with branches in the U.S. (HSBC).
Our current U.S. bank statements go to a stateside relative who banks with the same U.S. bank we do.

I think I'd start at this OFFICIAL Social Security page:

http://www.ssa.gov/pubs/10137.html#what

Budman, no kidding, they really closed the bank to other than real members?
Wow, that says something.
M (USAA almost 40 yr member)

Yes, someone posted a link: http://en.wikipedia.org/wiki/USAA

Direct deposits can be made to financial institutions in one of the countries on the SSA list.

The big clincher seems to be no Medicare benefits are available.

At any rate, I am glad the whole thing does not affect me at the moment.

I thought I read on a Mexico ex-pat forum a couple years ago that the US government was considering allowing Medicare benefits outside the Us. Must have fallen through. Too bad since medical care in Mexico is so much cheaper.

Hi Carrybean---there was a very interesting article in Time magazine a few weeks ago on medical tourism. . . underinsured US citizens getting a bargin operation/posh hotel suite combo in places like Thailand.

I didn't see that but I've heard that there is excellent medical/dental care to be had down there at a fraction of the cost by well-trained doctors so it's too bad Medicare won't cover the care for the ex-pats living there.

I'd expect they are living on more than just SS. Find a financial planner to work with before you make many plans!

My mother gets her social security payment sent directly to her French bank account. Unfortunately, the same is not true for her federal survivor benefits -- that cannot be transferred directly yet, so it is still going to a bank account in the US.

Just have your ss check sent t your regular bank in US & use an your A T M or buy goods with a credit card attatched to that account.

I have read if one does move outside of the US they should still keep at least a US checking account and US based credit cards so they will continue to have credit references. That makes sense.

My Soc.Sec. check is deposited directly to the French bank. Of course the Dollars are converted to the current rate for Euros. It works fine for me and the check is in the account on-time.

I cannot use Medicare, since I live outside of the US, but I don't have to pay the charges.

If you're living outside the US, make sure it's an acceptable country which is listed on the Soc.Sec. site.

The deposit of the checks was changed recently. Before it had to be sent via the mail.

Blackduff

You mean you can collect your welfare checks and not even live in the U.S.?

For Budman --

Oh yes. You don't even need to be a US citizen!

We have an old friend of the family, a Swiss woman who was married to an American. He died about 50 years ago, but she's still collecting on his SS -- in Zurich.

If you're entitled, then your address doesn't matter.

s

Budman
I love Social Security. I'm old enough to collect, before the politicians kill this program.

Welfare via European transfers will be strange but why not. If it runs to this, I'll sign up.

Blackduff

She can always open a bank account with her local American Express.
When my DH had to go to an isolate tour, I went back to Rome for 15 months and stayed with my children at my parents' house.
I just opened an account with AMEX and never had any problems.
At the end of my stay, I closed my account and received the moneys left in the bank in Dollars.

"You mean you can collect your welfare checks and not even live in the U.S.?"

Social Security is not welfare! Even Bill Gates will be entitled to SS when he reaches retirement age.

Heimdall, it all depends upon your perspective -- it might as well be. The system is broken, and the politicians won't fix it. What do they care, they're not tied to it.

And Bill Gates could care less.

Adding on to Budman's comments about SS being broken but from the perspective of a 26-yr-old.

DH and I, both CPAs, have set up our retirement plan expecting to receive zero, zip, nada from SS. We consider it just another tax we pay for which we'll receive no benefits. The system as it stands now is hopelessly broken and I've yet to have anyone with "economic knowledge credibility" tell me I'll actually get anything back from it.

The system is not broken. The program has worked. Social Security will continue to thrive if only the politicians and the govt. keep their paws of the general fund. Too many con artists have "borrowed" from the fund to pay for other "important" priorities. Every President after FDR has collected retirement checks, it is an honest and worthwhile project. It should not be trampled by politicians or misinformed individuals.

Hi elba,

I'd very much like to think you are right. However someone, someday has to pay for our massive deficit and program shortfalls (medicare looks to have the potential of being much worse than SS), and most experts seem to agree that it will be my generation.

I'll just be pleasantly surprised if I ever get a dime from SS, but will stick to my plan for comfortable retirement without counting on it.

I agree with you. We have to straighten our house and pay our bills. What we cannot afford is to do it partly by stealing from a fund that support millions of hard-working americans.

It's amazing to me to realize that 6 years ago, this country had absolutely no deficit whatsoever, in fact, there was a surplus of some 200 BILLION dollars. The changes that can be wrought in such a relatively brief period of time...

The Social Security program was designed to supplement your retirement income. It was never conceived to be your only means of support.

I will get off my soap box now, and go back to my usual happy-go-lucky traveler mode. Sorry to get so hot and bothered.

Not to mention "creative accounting" which would land all of us in Federal prison.
Can't wait to apply next month for my maximum 35 year "monthly reimbursements" from SSC.
M

Elba is correct. It's a supplement paid into by employers & employees. It's not a welfare check but unfortunately people have collected from it who have never paid into it.

People in their 20's & 30's are fortunate that they have the retirement plan opportunities with tax benefits that previous generations didn't have or only got later on.

I wrote my greedy,lard-butt senator over thirty years ago and asked to be exempt from paying SS taxes, saying the government could just deposit the taxes (minus a small portion for disability insurance)in a T-bill account and then give me the balance when I reached 65.

I got a form letter back saying not to worry, the government would take care of me.

Right - based on what my employers and I have paid in, I'd be a very, very rich man if that private account had been allowed. I would also have the freedom to pass on those funds to my kids.

Now I can only expect 1500 a month and have to pay taxes on it! And if I die after my LW, my grown kids get nothing!

Do the math and you get real angry at those clowns in D.C.

Carrybean,
As far as I know, the only folks legally receiving benefits who "never contributed" are the spouses who stayed home with the kids.
I rather think they did their share.
M

I agree on those folks, Mike but aren't there alcoholics & drug addicts receiving SS disability? I thought I had read where newcomers to the US who were older were also getting it (might be wrong on that part.)

I think this thread might "go south" so I'll bow out of it now.

There are two different programs handled by Social Security

Social Security - for any person that has worked at least 10 years and contributed to the fund and is insured.

SSI - a welfare program for the aged and disabled that are not insured. They must be americans to receive any funds.

degas is right, again!!!

Politicians would lead you to believe that Social Security is the wherewithal and greatest thing since sliced bread, and they are going to make sure that it's there for everyone (except them -- they don't contribute to this welfare program).

The social security system is nothing more than a welfare system that has outlived its usefulness. It may have been a great concept 60-70 years ago, but times have changed and the system needs to be reformed.

My pet peeve is AARP lobbied against reform because it was "too risky" for its seniors to invest in the stock market -- even though it was a "voluntary" program. Now, AARP is selling mutual funds to its members. The hypocrisy stinks.

Budman, it could be done very cheap and easy by creating something like the TSP Plan that millions of government employees have now.

I don't buy this utter bull about the average american worker not being smart enought handle a private investment account.

Still scared? Heck, stick half in t-bills and half in growth and income stock funds and don't allow anybody to touch it until they retire.

I agree about the AARP - its an automatic throw in the trash when I get thier mailings.

I get a tiny little bit of American social security.
It wasn't until I read about it in the financial section of my newspaper that I realised that I could claim for it.
I claim it because I paid into it when I was working in the US.
It just goes straight into my bank account.
I'd be interested to know how many people could claim it and don't know about it.

I was an AARP member from 50 to 60 yo(for about $10. total), but their programs and philosophy really and truly are whacko.
I had among my 25 or so partners, a delightful Indian physician. He earned $500,000-$800,000. a year, owned and lived in a $Mil McMansion and legally brought his elderly dad to Texas from India and put him on Medicaid at taxpayer expense.
Lots of legal abuse of the system is widely available to all.
Invest well, retire early and emigrate.
M (SMdA, Gto.)

"He earned $500,000-$800,000. a year, owned and lived in a $Mil McMansion and legally brought his elderly dad to Texas from India and put him on Medicaid at taxpayer expense."

Something is very wrong with these crazy rules. Call the IRS and rat him out - guy like that is bound to be cheating in other areas.

I would imagine that the father from India didn't have any income or a very small income and consequently qualified for Medicaid. BUT what I don't understand is that I thought and was certainly informed by a highly respected immigration attorney if you sponser a person from outside of the US you are financially responsible for them. But guess it takes someone street smarter than me to figure out how to circumvent the laws and systems, not that I would ever want to.

And I agree with all of you anti-AARP Fodorites, me too!!

The amount of money that an average US worker could get by investing the 5% of FICA that is retirement benefit related isn't all that much. The vast majority are better off with Social Security than they would be investing the $1000-$2000 a year on their own--with no guarantee that they'd make anything at all.

There is a social transfer (or welfare) element to Social Security in that lower income earners (and earners with large families) get a somewhat higher percentage return on their taxes than do higher income earners.

But it is not completely a welfare program as an earner does have to pay a certain minimum amount of taxes for a certain amount of time before any benefits are payable. And higher income earners do get higher benefits in absolute dollars than lower income earners get.

The Social Security system is funded through payroll taxes. The Federal Insurance Contributions Act (FICA) mandates a 12.4% levy on the first $94,200 (2006 limit) of each individual's earned income each year. The employer pays 6.2% and the employee pays 6.2%. Self-employed individuals pay the full 12.4%.

So subtract out 2.4% for disability and SSI welfare.

Take 10% (five from you and five from your employer) of your salary over 30 to 40 years invested even in a government bonds and that is a very sizable amount of money.

In regards to Medicare coverage abroad: it's true that Med. does not cover any costs incurred in a foreign country, but we have found that my husband's secondary insurance does pay. We have a second home in Grand Cayman, and DH regularly steps in a fire ant nest! (Highly allergic.)

Yeah, degas, I'm sure employers are going to jump right in and give that savings to their employees. Hah, hah, hah.

Oh, and SSI welfare is NOT funded out of the FICA tax. It is paid for out of general tax revenues.

Rufus, the employees have no choice now, they have to pay thier portion.

The 6.2% an employer pays on behalf of an employee is mandatory. If the system were changed so everyone had his/her own account why should the mandatory contribution be changed Rufus?

An individual starting at age 25, contributing $1000 in the first year, increasing it by a 3% inflation rate each year, earned 5%, the total accumulated value at age 65 would be just shy of $189,000 - hardly insignificant.

The employers contribution could be continued as is.

Would this be a good choice for everyone? Probably not. But certainly a lot better than sending all of it to Washington.

I hate political discussions at this site but if you have any concerns about the future of SS and Medicare you should read Anya Kamenetz' book "Generation Debt" or Laurence Kotlikoff's "The Coming Generational Storm". You can see more at:

http://www.anyakamenetz.com/gd-about.html