Sponsored content brought to you by BBVA Compass
In 2016, consider saving a bit of paper, time and money by using or implementing a direct deposit system in the workplace. Direct deposit, where employees are paid electronically from an employer, has becoming increasingly popular as a payment method. Here are some of the ways direct deposit can benefit employers and employees.READ MORE: Debris, Rising Water Rush Along Black Creek As Flash Flood Warnings Plague Glen Haven, Cameron Peak Fire Burn Area
Employers Can Process Payments Efficiently
Writing paychecks, processing payments and making sure paychecks are delivered to employees on time all take, well, time. However, using direct deposit means payments can be made automatically and at a consistent time for each pay period. As noted in the website Entrepreneur, using direct deposit can help employers save time and administrative costs. Although there is usually a startup cost associated with implementing a direct deposit system, the website ElectronicPayments.org (which is sponsored by NACHA — The Electronic Payments Association) noted that many companies “recoup any Direct Deposit start-up costs in savings and increased productivity in the first year of use.”
Direct Deposit Can Go Beyond Salary Payments From Employers
Although direct deposit can certainly be used to make salary payments to employees, ElectronicPayments.org points out the system can be used for other forms of payment to employees. If your employees have expenses that can be reimbursed, including those associated with travel or for purchasing work-related supplies, direct deposit can be used for ease.
Employees Can Save Time With Direct Deposit
When it comes to receiving your paycheck, time is money. If you get paid via a paper check, you may have to wait for payment to arrive via postal mail or for someone from accounting to hand it to you on payday. Then, you need to drive to the bank, fill out a deposit form and possibly wait in line — and that’s before you even deposit your paycheck. The time spent waiting to process your paper paycheck adds up, with the American Payroll Association estimating that employees may “spend as much as 24 hours each year waiting in line to cash their paychecks.” With direct deposit, your paycheck can be deposited into your account quickly and on schedule, even if you are away from the office. Having your money deposited in your account electronically also means you may be able to make payments a few days earlier.
Direct Deposit Can Help Employees Reach Financial Goals
Perhaps you’d like to save some money and buy a new car, go on vacation or even retire a few years early. How can you reach those goals a bit faster? As noted on the website The Simple Dollar, employees can use direct deposit to automatically allocate some of your paycheck to a savings account so you can meet those goals. You may need to discuss this with your HR staff to establish how to set up a direct deposit payment sent to more than one account.
Employees May Save Money With Direct Deposit
If your financial institution charges maintenance fees on your account, then signing up for direct deposit via your employer may be one way to get those fees waived. As noted by Consumer Financial Protection Bureau, some financial institutions may lower certain fees if you use direct deposit. Although the terms of the waiver may vary, it is worth discussing the option of direct deposit with a staff member at your bank or credit union.
Direct deposit systems can help both employers and their employees save time and money. If you are a business owner, consider speaking with your bank regarding the implementation of a direct deposit system. Employees can talk with their HR manager regarding their options for direct deposit.
Megan Horst-Hatch is a runner, reader, baker, gardener, knitter, and other words that end in “-er.” She is also the president of Megan Writes, LLC. Her work can be found at Examiner.com.MORE NEWS: Company Says GPS Showed Where Stolen Truck Was Yet Victims Say Aurora Police Showed Little Interest