No more long lines, wasted lunch hours, or trying to write up a deposit slip against the steering wheel at a drive-through ATM.
Direct deposit is simply the process of your employer’s bank communicating directly with your bank, so your paycheck gets deposited automatically instead of being passed around at your company until–hopefully–it finally reaches you.
Here’s how the process works:
- You authorize the transfer of funds directly into your bank account(s) by providing your employer with a voided blank check or deposit slip for your bank account.
- Typically, you may specify how much of your paycheck you want into each of your accounts.
- The appropriate wages–minus taxes, deductions, 401(k) salary deferrals, etc.–are automatically deposited into your bank account(s) each pay period.
- On payday, you’ll receive a voucher that confirms the amount deposited into your account.
Sure, there’s a list of advantages here, but what’s most notable is that there are currently no widely recognized disadvantages to a direct deposit program.