A growing number of employers are switching their payroll over to direct deposit. As an employee, you may be wondering what that means for you. Is it worth supplying your bank account information to set up the direct deposit? Once you make the switch, you will start benefiting from many perks.
One of the best features of direct deposit is its speed. Your payday funds will be deposited into your account instantly. You won’t have to wait to pick up a check or spend time driving to the bank to deposit it. The funds will also be available sooner than if you wait for a check to clear.
Direct deposit isn’t just convenient for your employer; it’s handy for you, too. No matter where you are, you will receive your money on payday without picking up a check. That means getting paid on your days off or even while on vacation.
With direct deposit, you have flexibility for where your funds go. If you use a voided check to set up your deposit, your whole paycheck will go into your checking account. However, some employers will let you split your deposit into multiple accounts. You can set a portion to go directly into your savings account each month.
Having your paycheck instantly, electronically deposited is safer than using a paper check. Checks can be misplaced, stolen, or damaged. As long as no one else has cashed your paycheck, you can request a replacement from your employer. However, that means waiting even longer to get paid. The most common form of payment fraud is check fraud. You can avoid the possibility by skipping the check.
Using direct deposit has an additional benefit for some people. Does your bank charge you a monthly account fee? Unfortunately, many do if you don’t have enough cash in your checking account. Regardless of your total balance, most banks waive the charge if you meet the direct deposit requirements. You may need to direct deposit a certain amount or number of times per month.
If your employer offers it, direct deposit is free for you. The only thing you need is a bank account and to pass along routing information. If you don’t currently have a bank account, you can shop around for one with free checking.
Don’t be scared to make the switch to direct deposit. It’s quick, convenient, helpful, safe, and completely free.