There’s a short list of things that really haven’t changed in the past 50 years, and a paper check is one of those things. Despite the advances in financial technology, paper checks have remained relatively unchanged. In a digital world, however, they’re increasingly expensive, cumbersome and unsecure.

Many employers already have an all-electronic system for paying their employees, and direct deposit is at the center of that system. Direct deposit transmits your paycheck from your employer’s business account directly into your checking, savings or other account(s). You still get a pay stub or an electronic equivalent from your employer that lists the amount of the transfer along with any deductions, such as taxes, health care or retirement.

You’ll no longer have hold on to that check until you can find time to get to a branch. Payroll deposits clear instantaneously, which means the money is generally available in your account the same day.

Direct deposit has so many advantages, it’s hard not to choose. Many large employers and some benefit providers require it, and it’s easy to see why. Let’s look at three reasons why direct deposit may be right for you.


A paycheck is the largest check most people see on a regular basis, and a tempting target for theft. Think about how your employer would react to someone else picking up your paycheck. Someone could pretend to be a spouse or friend doing you a “favor.”

The signature requirement is some protection, but many check-cashing establishments don’t look closely for a match. It’s easy to cash a stolen check and the law provides little protection. Your employer might be sympathetic, they might not issue a second paycheck to you. The burden is then on you to prove the theft in order to get your salary.

With direct deposit, those concerns are virtually nonexistent. There are no paper checks to keep safe, no one needs to pick up your paycheck for you and there’s no concern that someone else will accidentally be given your check. The whole transaction is handled seamlessly and securely by computer.


The payroll process is incredibly complicated for companies. Many companies hire outside firms to ensure they’re accurately paying their employees in compliance with state and federal regulations. One of the costs involved in payroll production is the printing of checks. Paper checks must be printed, signed and recorded, all of which requires labor.

The cost of writing, verifying and safeguarding a paper check is about $1 per employee per pay period, assuming no lost checks or disputes. The time lost to distributing and depositing those checks costs about $2 per employee, so it costs businesses about $3 to print and distribute paper checks. Direct deposit costs about half as much.

These savings may seem insignificant, but they add up quickly. When your employer spends less money on payroll, it could mean they have more money to pay you. Whether those cost savings result in a lower-priced product, more investment in the business or higher wages, you benefit. When your employer comes out ahead, so do you.


Obviously, direct deposit saves you an errand every pay period. The stress of fighting rush-hour traffic to make it to a branch office before closing time is considerable. There’s also no need to worry if you got your paycheck deposited in time for same-day processing.

Beyond the obvious conveniences, direct deposit opens up other possibilities. You can automate your savings by depositing a portion of each paycheck into a savings account and the rest into your checking. You can pay bills more easily online since you get confirmation that your funds are available

Paperless payroll saves trees, it saves time and it saves frustration. It does all of this while being safer, faster and more secure.

If you’re unsure about your direct deposit options, stop by or call FSU Credit Union. Our team members can get you the information you need to set up direct deposit and can help you organize your deposits to meet your financial goals.

*The content provided in this article consists of the opinions and ideas of FSU Credit Union, does not constitute legal or financial advice, and should be used for informational purposes only. Any decisions you make based on the information contained in this article is made in your sole discretion and liability. FSU Credit Union disclaims any damages or liability for decisions you make based on the information provided.

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