Being able to split your direct deposit service will help you save money by allowing you to directly put cash into your savings and investment accounts, that way you can put aside money stored for emergencies, planned expenses, or retirements.
Why is it good to use direct deposit?
Living in this new economic environment, it would be wise for you to invest your time and money into investments that help cater to your expenditures and future needs and endeavors.
Although it’s very important to save money in this new economic environment, many Americans still find it hard to do so. Splitting your direct deposit into savings and checking accounts will really help you take that next step to save you money.
What do agencies say?
The CFA (Consumer Federation of America) in a survey found that there is a 66 percent chance employees will use direct deposit services. Only 23 percent will split their deposit into different accounts. Only 59 percent of those individuals who have access to direct deposit services and use it will have the option to split their deposits. Only 39 percent of those who do have access to a direct deposit service will choose to split their deposits.
The CFA found that many companies are not offering their employees a split direct deposit, which is unsettling. “They (Companies) are denying their employees a basic benefit that doesn’t cost the company any more to offer and can potentially help their employees start consistent savings program” said Stephen Brobeck, Executive director of the CFA.
In 2006, NACHA – the Electronic Payments Association – showed that employees who use direct depositing save $90.00 more per month than those who use other methods to save their money.
NACHA suggests that the best way for you to save money, at an incredible rate, is to make sure your direct deposits are split where you can deposit just enough in your checking’s account to cover your expenses, and have them automatically deposit the rest into your savings account.
Why should businesses include direct deposit?
For companies who don’t already offer this split direct deposit service, are losing out on a beneficial benefit that they could be potentially offering to their employees. The split direct deposit service can help their employees save money, and companies are losing out on an opportunity to retain their valued employees by not offering this benefit to their employees.
“Direct deposit helps employees save money and it’s free for employers to offer this benefit,” said Dan Maddux executive director of the American Payroll Association.
It would be in an employee’s best interest to ask their pay roll departments if there was a way for them opt into a split direct deposit option. Employees should suggest to their employers to add a split direct deposit service if that company is not offering that benefit yet.
The CFA Survey also showed that even though 66 percent of all employees use direct deposit, of those who have access to direct deposit, roughly 78 percent use it. Of those who don’t have access to a direct deposit service, 76 percent of them said that they would use the service if they had the option and opportunity to use it.
Why should you opt in for direct deposit?
Stephen Brobeck said “Even if you only have $20 left each month after your expenses, deposit it automatically to your savings account. With this type of consistent savings, you will be well on your way to establishing a financial emergency fund, college savings program or a vacation fund.”
A saving all people should invest in.