You can receive Social Security disability benefits without a bank account, but your options are becoming more limited. Here's what you need to know about receiving SSI or SSDI payments and why opening a bank account might be worth considering.
In this article, we'll cover:
- Payment options without a bank account
- Changes to paper check availability
- The Direct Express card option
- Why a bank account might be better
- How to open a bank account on disability
1. Current Payment Options
Without a bank account, you can receive benefits through:
Direct Express card:
- Prepaid debit card from the government
- No bank account needed
- Benefits loaded automatically
- Can use anywhere Debit Mastercard is accepted
Paper checks (being phased out):
- Mailed to your address
- Must be cashed or deposited
- Delays and security risks
- Limited availability going forward
Electronic Transfer Account (ETA):
- Basic account at participating banks
- Low cost ($3/month max)
- Limited features
- Being phased out in some areas
2. Paper Checks Are Going Away
Important change:
- Social Security is moving everyone to electronic payments
- Paper checks are being phased out
- New applicants typically can't choose paper checks
- Security and efficiency concerns driving the change
Why the change:
- Checks can be lost or stolen
- Mail delays cause payment delays
- Check cashing costs money
- Electronic payments are more secure
If you currently get paper checks:
- You may be required to switch
- Direct Express is the alternative if you don't want a bank
- Consider opening a bank account instead
3. The Direct Express Card
What it is:
- Prepaid debit card for federal benefits
- Issued by Comerica Bank
- No credit check required
- Free to receive benefits on it
Pros:
- No bank account needed
- Benefits arrive on time
- Can use for purchases
- ATM withdrawals available
- Free balance inquiries
Cons:
- Fees for some transactions
- Limited customer service
- No interest earned
- Can't write checks
- Fewer features than bank accounts
- Some merchants don't accept prepaid cards
Fees to know:
- Free ATM withdrawals at network ATMs
- $0.85 for out-of-network ATM (after first free one)
- Fees for replacement cards
- Fees for paper statements
To sign up:
- Call 1-800-333-1795
- Or sign up at godirect.gov
- Or call Social Security
4. Why a Bank Account Might Be Better
Benefits of direct deposit to a bank:
Earlier access:
- Some banks offer early direct deposit
- Get benefits 1-4 days before payment date
- Purple offers up to 4 days early
No fees:
- Many banks have free checking
- No transaction fees
- Free debit card
- Free online banking
More features:
- Bill pay
- Mobile check deposit
- Savings accounts
- Money transfers (Zelle, etc.)
Better protection:
- FDIC insured
- Fraud protection
- Easier to dispute charges
- Better customer service
Builds financial history:
- May help with credit
- Shows financial stability
- Easier to get other services
5. Barriers to Opening a Bank Account
Common concerns:
ChexSystems issues:
- Past banking problems can block new accounts
- Unpaid fees or overdrafts reported
- Fraud or suspected fraud history
Solutions:
- Second chance checking accounts
- Banks that don't use ChexSystems
- Online banks with easier approval
- Credit unions with flexible policies
Identification issues:
- Need valid ID to open account
- Homeless or unstable housing challenges
- Immigration status concerns
Solutions:
- State ID or driver's license
- Passport
- Some banks accept alternative ID
- Consular ID (some banks)
Minimum balance fears:
- Worry about maintaining minimums
- Fear of overdraft fees
Solutions:
- Choose accounts with no minimums
- Look for accounts designed for benefits recipients
- Online banks often have no minimums
- Purple has no minimum balance
6. How to Open an Account for Disability Benefits
Step 1: Gather documents
- Social Security number
- Government-issued ID
- Proof of address (benefit letter works)
- Phone number and email
Step 2: Choose the right account
Look for:
- No monthly fees
- No minimum balance
- Free direct deposit
- Early access to deposits
- Understanding of disability benefits
Step 3: Apply
- Online (easiest)
- In person at a branch
- By phone (some banks)
Step 4: Set up direct deposit
- Get routing and account numbers
- Change direct deposit with SSA
- Online at my Social Security
- Or call 1-800-772-1213
- Or visit local SSA office
Step 5: Wait for first deposit
- Changes take 1-2 payment cycles
- Keep old payment method active until confirmed
7. Best Banks for Disability Benefits
Look for these features:
- No monthly maintenance fees
- No minimum balance
- Early direct deposit
- FDIC insured
- Good customer service
Types of accounts:
Online banks:
- Often no fees
- Easy to open
- Good mobile apps
- May offer early deposit
Credit unions:
- Member-owned, often lower fees
- May have second chance options
- Community-focused
Banks with disability-focused features:
- Purple (designed for benefits recipients)
- Understand SSI resource limits
- Tools for tracking benefits
Second chance accounts:
- For people with ChexSystems issues
- Limited features at first
- Can graduate to full account
8. For SSI Recipients: Special Considerations
Remember the resource limit:
- $2,000 individual / $3,000 couple
- Bank balance counts on the 1st
- Keep balance under limit
Choose an account that helps you:
- Track your balance easily
- Avoid fees that eat into benefits
- See when you're approaching limits
Don't avoid banking due to limit fears:
- Having a bank account is fine
- Just manage your balance
- Spend down before the 1st if needed
9. Making the Switch
If you're on Direct Express or paper checks:
- Open your new bank account
- Get the routing and account number
- Log in to my Social Security (ssa.gov)
- Click "Change Direct Deposit"
- Enter new bank information
- Confirm the change
Or call SSA:
- 1-800-772-1213
- Have bank info ready
- Can verify change was made
Timeline:
- Changes take 1-2 payment cycles
- Keep old method active until you confirm deposit
- Watch for first deposit in new account
How Purple Helps
Purple is built for people on disability benefits:
- No minimum balance requirements
- No hidden fees
- Early access to SSI and SSDI (up to 4 days)
- Easy to track your balance
- Designed to help you stay under SSI limits
- Simple application process
- Customer support that understands your needs
With Purple, getting a bank account for your disability benefits is simple and stress-free.