SKIP THE TELLER LINE ON PAYDAY
Lori A. Bahnmueller
Michigan Credit Union League - Your Money Matters
Tired of waiting in the teller line on payday? Wish you could have someone else deposit your paycheck for you? Consider direct deposit. Direct deposit is a service which occurs when you authorize an agency, institution or your employer to place funds directly into your checking or saving account without your having to carry it to your credit union or bank. If you're a bit reluctant to try direct deposit for whatever reason, there really is no cause for worry. You will receive for your records an earnings statement on payday that shows how much money was deposited, as well as how much money was withheld for taxes, the company savings plan, or any other reason.
Convenience is only one of the main benefits you receive by having your check direct-deposited. You save time. No more waiting in teller lines on payday or giving up your lunch hour to deposit your check!
Direct deposit eliminates risk, too, and assures you safety and a timely deposit. Your deposit is consistently made on time and you get paid even if you're not at work -- if you're ill, on vacation or on a business trip. It's also helpful for people who work off-hour shifts and have trouble getting to their financial institution during normal business hours.
Direct-deposited funds also "clear" automatically. You can write checks right away without concern that your paycheck funds haven't been credited. Direct deposit assures that your check earns interest as soon as possible. If you have to deposit your paycheck in person, any delay postpones when your money starts to make money for you.
Direct deposit with payroll deduction is a powerful money management tool. Using payroll deduction to put a percentage of your paycheck into savings each payday is an easy and "painless" way to save. You can also choose to make a loan payment to your credit union or bank automatically. This way you can accomplish three things at the same time -- build your savings, fulfill a debt obligation, and make funds available immediately.
I have taken advantage of the same process for paying many bills. Whenever possible, I have payments for recurring bills automatically paid from my credit union checking account. So far, I've managed to have my gas, electric, insurance and telephone bills paid that way. That makes sure I don't miss a payment or pay it late. It saves me writing a check, addressing an envelope and paying for postage. About two weeks before the bill is due, I receive a statement in the mail, which I enter in my check register as if it were a check. It saves time, money and mistakes.
It's easy to set up direct deposit and direct bill payments, just ask your employer and your credit union or bank. You'll be on your way to one of the most useful benefits of the Information Age.