My State does not allow companies to mandate Electronic Pay… What can I do?

In the event that your state does not allow mandating electronic pay, you can still offer your employees options of direct deposit to a bank account, payroll card or continue with paper checks. However, it is at the company’s advantage to offer incentives for electronic pay. You may want to remind employees of benefits associated with electronic pay, such as maybe getting paid a day earlier, not having to go into work on their day off to pick up their check, or not having to run out on their lunch breaks to cash a check. Many of our clients find that if they get the employee to use the card for 2 payroll cycles, the employee loves it and keeps the payroll card. According to the NACHA, 97% of employees who use direct deposit are happy with it.

You may find some resistance to direct deposit or electronic pay, either because the employee cannot get a bank account due to past financial issues or they don’t want to pay the fees incurred with bank accounts. Payroll cards can be the answer. There is no cost to the employer or employee to set up or receive funds and the pay card can be used absolutely fee free. Recent regulations require a payroll card to provide at least one free of charge transaction to access all of the cardholder’s money. With many payroll cards, you set up the payroll card through your payroll system just like a bank account. You won’t even notice a difference, except of course less paper checks.

Will Banks Charge Higher Fees in the Future on Debit Cards and Checking Accounts?

The simple answer to this question is: “it depends”.  What does it depend on?  It depends on whether or not the regulations passed by the Federal Government will continue in force, be modified, repealed or possibly even be expanded.  Ever since the housing market meltdown the Federal Government tried to protect consumers from businesses; but it really needed to protect them from government regulations as well.  What does that mean?  It means in 2005 when congressional leaders pushed for Fannie Mae to make more home loans to people, the banks complied and made more loans.  When the housing bubble burst, the Federal Government immediately began pointing fingers at Wall Street and the banking industry for generating a profit by making risky loans to under qualified buyers. Never mind that congress was pushing in that very direction or that consumers were applying for loans on houses they knew they couldn’t afford.  Ok, so how does that impact fees on checking account and debit cards?  The Dodd Frank Bill pushed through congress to protect consumers from Wall Street and banks contained many different components.  One of those was the Durbin Amendment which significantly reduced the fees retailers pay banks for accepting debit cards.  There were also new regulations passed to modify the prices banks can charge consumers on checking account overdrafts.  Finally the Federal Government is heavily scrutinizing loans made by banks and banks have cut way back on lending to avoid scrutiny.  The result of this type of Federal Government regulation is lost business and revenue for the banking industry well beyond what was called for, and eventually they will need to compensate for it somewhere somehow.  What are the alternatives for hard-working consumers?  One option might be to consider a prepaid debit card.  Although these cards do have some fees, they may be less than what your bank may charge for a traditional checking account, you can’t overdraw them and everyone can qualify. Paycards or Payroll cards are one of the best options for prepaid debit cards because they are provided by employers at no cost and employees receive and can access their pay at no cost each time they are paid.   Will there be higher debit card and checking account fees in the future?  Hard to know at this point but one thing’s for sure, the more the Federal Government tries to dictate and control the outcome of “free enterprise”, the less “free enterprise” there will be and that will never be good for hard-working U.S. consumers.

If I get a payroll card from my employer and then leave, can I still use it?

The answer is an emphatic YES! Once your payroll card is issued through an employer, it belongs to you and not the company. The employer has no control over what funds you have distributed to the card outside of your direct deposit at that job. For instance, if you want to use your payroll card to receive electronic pay from a new or second job, as long as that employer offers direct deposit, you may do so. If you are a ReadyFUND$ cardholder, you can find a direct deposit authorization form on the website listed on the back of your card, http://www.readyfunds.net/ under the tab “Using my card account” and then click on “changing jobs”.

Besides payroll direct deposits, you can also have other benefits loaded to the card. Some of those are tax refunds, unemployment benefits, child support, college grant monies, disability, and social security benefits.

Why miss out on the eZsuite of financial products just because you are leaving your employer? You dont have to and you shouldn’t. With eZsave you earn interest while saving; eZaccess offers emergency cash; eZ transfer allows you to transfer your money off of your payroll card to a bank account; eZbillpay allows you to pay bills online using your ReadyFUND$ card; and eZlearn educates you on how to better manage your money and build a budget. Don’t miss out on these awesome features by not taking your pay card with you to your next employer. Take advantage of the portability of your ReadyFUND$ card.

How Can I avoid Fees on My Payroll Card?

All payroll cards and prepaid cards have fees. Sorry, that’s the way it is. While some payroll cards fees may be higher than others, there is always a way to use your payroll card without every paying a fee. Want to know how? Don’t worry I am going to tell you. Read on…

First: All payroll cards have to let you access your payroll deposit 100% free of charge after you get paid. The way that payroll cards usually do this is after you get paid, each time, there are certain transactions that allow you to access all of your paycheck without incurring fees. So if you wanted to transfer your paycheck to a bank account-FREE. Or, if you wanted to withdrawal all of your money at the bank-FREE. There are usually multiple transactions that give you this ability. If you don’t want to take all your money off the card, but still want to limit fees, keep reading.

Second: While not all payroll or prepaid cards offer this, especially not prepaid cards, good payroll card companies will offer free POS purchase transactions. That means when you are buying something at the register, whether you select credit or debit, you won’t get charged a fee from your card. Some even allow you to get cash back with no charge. Prepaid cards are not usually this way, and like I said not all payroll cards are, but there are some good companies out there that do this.

Third: Sign up for text alerts! Or email alerts, or whatever makes you happier. I cannot stress this feature enough.  Balance alerts help cardholders avoid those pesky “Non Sufficient Funds” fees. You can sign up for balance alerts daily, so you know your balance first thing each morning. Or even anytime your balance changes. That is what I do. I know automatically when my payroll hits my card and my balance after every transaction. If I don’t know if I have enough on my card I can either look at my last text or simply request it. If you receive text alerts to your cell phone, there’s a number you can text something to, like BAL or BALANCE, and receive a reply back to you with your current balance. This is a life saver if you are ever in line with a cart full of groceries and can’t remember if you had $50 or $150 left.

Fourth: See if there is a “partner” network your payroll card uses. While you will get charged for withdrawing money from an ATM, if your payroll card partners with a specific network you may be able to avoid additional fees. Some ATMs charge fees beyond what your payroll card company charges. Find the network that does not charge users of your specific payroll card any additional fees. You may still pay the ATM withdrawal fee to your card, but it will be less than paying one to the card and one to the ATM.

Some of these suggestions will help you avoid fees all together. But that may not be practical for everyone. If you can’t eliminate, at least you can minimize.

www.readyfunds.net

How do I avoid getting into the payday loan trap?

A payday loan is a short term loan provided either through a local loan store or through an internet based provider. These loans are normally 14 days in length and carry a fixed fee of 20-25% of the loan value. Some payday loans are renewable, which by just paying the fee, you can extend your payoff another 14 days. If you extend rather than paying in full, you have just fell into the payday loan trap. The payday loan trap is an endless cycle of borrowing and paying off the same loan and paying huge amounts of interest to be able to do so. Most customers continue paying just the fee until they are required to pay off the principal in full. By that point they have more than likely not been able to catch up and will have to take out another payday loan.

We all have unforeseen things happen to us and think ‘well if I can just borrow a little money to get by this week, everything will be ok’. We are just digging our self a little hole. If we don’t pay off the loan in full when it is due or pay down against the principal, we have just dug that hole a little bigger and it becomes an endless cycle of robbing Peter to pay Paul.

To avoid getting caught up in the payday loan trap, there are several steps you can take:

• Never take out a loan for non-essentials such as vacation, entertainment, etc.
• Only use payday loans for emergency situations
• Try not to borrow more than 50% of your next paycheck
• Never borrow more than you need or can afford to pay back in 2 weeks
• Shop around for the best rate of a payday loan
• Never pay just the interest and extend the loan, be sure you can pay it in full
• Set up a budget. Write out all your expenses and their due dates vs. your income

Setting up a budget is extremely helpful in understanding just exactly how much discretionary income you have. On our website, www.readyfunds.net under our eZlearn/Money management page, we have downloadable templates that you can use to set your long term goals, and templates to keep track and manage your money. We also have a savings account to set aside money each payroll for those emergencies that come up unexpectedly. If you set it aside a little each week, you will never miss it.

At ReadyFUND$ we understand that sometimes you do have an emergency and   need a little extra money. ReadyFUND$ cardholders do have a short term loan option called eZaccess offered by a third party company with a low loan rate. eZaccess has features that help prevent you from falling into the Payday loan trap.  For more information, fees, terms and conditions, log into your ReadyFUND$ account at www.readyfunds.net.

“If you see yourself as prosperous, you will be. If you see yourself as continually hard up, that is exactly what you will be.”
Robert Collier

Tired of check cashing fees? Ask your employer for a payroll card

If you are an employee without a bank account or someone who uses check cashing services, you may be paying a steep price for speed and convenience and check cashing costs continue to rise. Checks cashed at check cashing centers can incur an average of 3-5% of the check amount in fees, regardless of the nature of the check.

If you do not have a bank account and you want to stop paying check cashing fees….

A Payroll Card is your solution:

• Easy approval process, no credit required
• The same fraud liability protections as a standard debit card
• Easy to use for online or phone purchases
• Access cash from ATM machines
• Cheaper than cashing your check

There are a number of different Prepaid Cards on the market, and they usually fall into two categories: Prepaid Debit Cards available to consumers in retail locations (these are the ones you hear about a lot in the news) or Prepaid Payroll Cards offered directly through Employers as an Employee Benefit.

Prepaid Debit Cards that can be purchased at retail locations like Wal-Mart may be your only option if your Employer does not directly offer a Payroll Card. With this said, before you go purchase one, you should ask your Employer to look into getting payroll cards. There are several reasons this may be a better option: It will likely cost your employer nothing to offer a Payroll Card as an Employee Benefit, the card will have many more benefits and features than any retail products and employer offered payroll cards will come with lower costs and less fees.

Companies like ReadyFUND$ Payroll Cards (www.readyfunds.net) specialize in offering Payroll Cards through Employers. Simply by asking your Employer to call ReadyFUND$, not only could you have a feature rich and lower fee Payroll Card, your company will thank you for introducing them to a tool that will allow them to move to 100% electronic pay and convert all of their employees to direct deposit. Your Employer will save money by not printing paper checks, be able to streamline their payroll process and help other employees similar to you have access to their own “bank on a card”. You will save money by not having to cash your payroll check and pay check cashing fees, save time by not having to wait in line to cash your check or pay bills and get to enjoy the convenience of a prepaid debit card. Good Payroll Card companies also offer great features like an interest bearing savings account, short term loans and online bill payment access.

Talk to your employer if a Payroll Card is what you think you need. Many employers don’t think about payroll cards as an option until an employee brings it up. For information about payroll cards, visit www.readyfunds.net

Is my Mobile Phone really going to become my purse or wallet?

Mobile phone technology has grown so rapidly in the past 2 decades. I remember watching Saved by the Bell when Zach Morris had a “mobile phone”. It was a huge brick with an even longer antenna. Now the Saturday Night Live Will Ferrell skits featuring the matchbook sized cell phone aren’t too far off. We’ve evolved from playing snake on our brick phones to playing Angry Birds, updating our Facebook statuses and watching YouTube videos on our smart phones before breakfast.

So back to the question at hand, will my cell phone replace my wallet? Probably. Although I’ve never used it, there’s an app on my iPhone that you can swipe and charge someone’s credit card, great for a small business owner. It even organizes your customers “cards” by brand, their name, stores receipts and keeps accounting records.  Starbucks now has a mobile payment app too. Your phone displays a barcode that you place under their scanner, the barcode is linked to your Starbucks card, and the transaction is processed. Starbucks said it saw 3 million mobile transactions in the first 9 weeks after launch of the app. Europe began testing the iPhone “iWallet” last January. The iWallet allows consumers to pay for things the same way you buy a song on iTunes. It is setup and linked to your card of choice.

These companies may be onto something. Strike while the irons hot. This market is small now, not very saturated, and deemed sort of a niche. If someone like Apple grabbed this projected $600 billion market, you can believe the adoption rate would increase faster than the iPhone saturation. I’m not saying start throwing away your Gucci purses and Kenneth Cole wallets, but maybe start being aware of apps available for your phone and start noticing those funny box barcodes you see in retailers. Soon, in the not so distant future, someone will be writing a blog about how they remember us and our inefficient cell phone payment apps while they’re scanning barcodes on their wrists to buy a cup of coffee.