Direct deposit isn’t just for paychecks, either. Allison could have her college put her financial aid check into her checking account automatically, too. And, she can use direct deposit for her income tax refund.
but wait, there's more!
With all of these deposits being made to her account automatically, Allison might want to take advantage of payroll deduction, too. For example, Allison wants to spend a summer in Europe after she graduates. She could tell her credit union to take $20 out of each paycheck and put it in a separate account for her trip.
Direct deposit is a great first step in keeping track of your money.
As she counts down to graduation, and watches her trip account grow, Allison sees that she’ll be able to pay for the big trip without getting into credit card debt. Once she sees how easy it is, Allison could set up other automatic plans, maybe save for a car, or even start paying off student loans.
Just think – no more frantic searching her room or car for lost checks, no more last minute Friday afternoon trips to the credit union so she has money for the weekend.
If Allison decides to go home for a weekend, or head off on spring break, she doesn’t have to worry about picking up her paycheck on the way out of town – it’ll already be in her account, and she can use her ATM card to get to the money.
And because her money arrives in her account right on payday, not whatever day she gets around to cashing the checks, she starts earning interest right away.
For Allison, starting direct deposit is a great first step in keeping track of her money. And it can be for you, too. Ask your boss or credit union about how you can make your life easier with direct deposit.