Are you running to the bank every time payday hits? Filling out deposit slips and signing checks every two weeks?
Stop.
There’s a better way. It’s called direct deposit.
Direct deposit uses the Automated Clearing House system to electronically deposit your paycheck into any checking or savings account you choose. This has a ton of benefits:
Faster- you will almost certainly receive your funds sooner through direct deposit. At my last job, I received my “paycheck” a whole 2 days before the paper checks would arrive.
Safer- it’s incredibly easy to lose a paycheck, especially if you don’t get to the bank immediately. Thefts happen. Wallets are pick-pocketed and cars get broken into. No petty thief is going to be able to steal your direct deposit.
Frugal-direct deposit means no more gas wasted on trips to the bank.
High tech- I think it’s just plain cool that technology can do this. Using paper for paychecks just seems old fashioned now.
I think the biggest benefit is just the simplicity of it. No more driving to the bank. No lost checks. The money is there automatically. And even more important: there’s no temptation to cash out part of the check.
I know what you’re saying. “This is awesome, how do I set it up?”
It’s simple.
You Need:
- Your bank account number
- Your bank’s routing number
- Employment at a company that offers direct deposit
You can find this information on a check or in the paperwork you received when you opened the account.
Simply give a voided check (you void a check by writing “VOID” in big capital letters on the front of the check in pen) to your boss or whoever manages your company’s payroll. If you work for a large corporation, you may be able to do all of this online. If you don’t have any checks, you can just write down the two numbers and your place of employment will know what to do.
Once that’s completed, you’re done. No more work is necessary. You’ll start to receive your paycheck directly in your bank account within a pay period or two.
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Great article! I remember my first job: I was 16, did NOT officially have my own car, and was working at a telemarketing job. Paychecks were available for pick up every other Friday morning. Unfortunately, I didn’t work on Fridays. So, I would pick up my check on Mondays. THEN, I would have to wait until I could go to the bank on Friday (1 full week later!) to deposit the check. THEN, it would take until the following Monday for the check to fully clear through the bank.
We are talking 10 days in just to receive my money. Ever since then, I’ve been using direct deposit. Now, I get my paycheck 1 day BEFORE my official payroll date.