Stoia

Personal finance glossary

Direct deposit

Definition

Your paycheck or government benefit sent electronically into your bank account through the ACH network, arriving faster and more reliably than a paper check. Most employers let you split the deposit across multiple accounts.

Why it matters

The split feature is the quietest automation in personal finance: money routed to savings before it ever lands in checking never gets a chance to be spent.

Example

A worker splits a $3,000 monthly paycheck: $2,600 to checking for bills and life, $400 straight to a high-yield savings account. Saving happens by default, $4,800 a year, with no willpower involved.

Put it into practice

Related terms

This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.

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