If you’re not part of the 94% of American workers who get paid by direct deposits, you’re missing out on one of the most popular forms of payment. It is a safe, fast and convenient way to receive payments. In simple words, a direct deposit is an electronic payment from one bank account to another. This type of automatic transfer has many benefits and is easy to get started.

Direct Deposits Benefits

Below, we’ll explore five reasons why you should switch to direct deposit.

1. Automatic process

When you receive funds via direct deposit, the funds are added to your account without any action on your part. However, with a paper check, you must take the extra step of depositing or cashing the check. This can quickly become a hassle if you’re too busy to go to the bank.

2. Paperless

With direct deposits, you can keep digital records instead of leaving a paper trail. You also get rid of the risk of losing a paper check. Plus, it’s better for the environment if you go paperless and automate your paychecks.

3. More savings

Automating your paychecks can positively affect how you manage your money. For example, you can set up your direct deposit to automatically transfer funds to different accounts, like your savings account or an emergency fund. In this way, it is easier to save.

4. Pay your bills on time

One of the fears that comes with automatic bill pay is that it could lead to an overdraft. Setting up direct deposit helps eliminate this concern, as you can ensure you have money in your account when bill payments are withdrawn. Just set your automatic payments to run a few days after each pay period.

5. Faster payment

With direct deposit, you won’t have to deposit a check and expect it to be paid. What’s more, if your normal payday falls on a holiday weekend, you will generally receive your payment on the last business day before the weekend. Some banks even allow you to get paid before your normal payday. Axos Bank, for example, offers Express Direct Deposit for select checking accounts, giving you access to your funds up to two days earlier.*

How to set up direct deposit

If you haven’t used direct deposit yet, you may be wondering how it works. Fortunately, the process is very simple. To make direct deposit money transfers, banks use the Automated Clearing House (ACH) network. Here are the typical steps to set up an ACH direct deposit:

1. Get the direct deposit form

Most employers offer a form that you can fill out to set up your direct deposit. This form can usually be completed online and is usually offered during onboarding for a new job. If you don’t know how to access the form, ask the HR department. H H. from your employer.

On the other hand, if your job doesn’t offer a direct deposit form, you can get one from your own bank. You will need to send this completed form to your employer or whoever is sending your funds.

2. Complete the form

To complete a direct deposit form, you will generally need to know the following information:

• the name of your bank
• Your bank address
• Your bank account number
• Your bank routing number

You can find your bank routing number and account number by logging into your online account, calling the bank, or looking at the bottom of your paper checks.

3. Submit the form

Once you complete the form, send it to your employer. That is all. You may want to ask how long it will take to receive your first direct deposit. Depending on your company’s policies, you may have to wait until after the first pay cycle before receiving your first direct deposit, so it’s a good idea to ask if you’ll receive a paper check for your first payday.

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