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Does Direct Deposit Hit Your Account on Christmas Eve?

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Dec. 23 2021, Published 1:25 p.m. ET

Most people spend a lot during the holidays. You spend money on gifts, groceries for your holiday meals, and other expenses. So, getting paid on time is essential to replenish your funds. On Dec. 24, you might be expecting your paycheck to be deposited in your bank account, but does direct deposit hit on Christmas Eve?

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Technically, Christmas Eve isn’t considered a banking holiday, so your paycheck should be deposited into your account without any issues. Also, direct deposits tend to go through at midnight of the pay date, which would be Dec. 23.

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The Federal Reserve is open on Friday before a holiday.

You don't need to worry about a holiday shutdown at the Federal Reserve impacting your direct deposit. According to the Fed’s website, banks and branches will be open on Friday before a federal holiday that falls on a Saturday. Since Christmas is on Saturday, the banks will be open on Friday or Christmas Eve.

The same goes for New Year’s Eve. New Year’s Day is a federal holiday, but since it falls on a Saturday, some banks might observe the holiday on Dec. 31.

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What are the federal holidays for 2022?

There are 11 federal holidays in a year. Here are the holidays in 2022:

  • New Year’s Day - Saturday, Jan. 1

  • Martin Luther King Jr. Day - Monday, Jan. 17

  • Presidents Day - Monday, Feb. 21

  • Memorial Day - Monday, May 30

  • Juneteenth National Independence Day - Sunday, June 19

  • Independence Day - Monday, July 4

  • Labor Day - Monday, Sept. 5

  • Columbus Day - Monday, Oct. 10

  • Veteran’s Day - Friday, Nov. 11

  • Thanksgiving Day - Thursday, Nov. 24

  • Christmas Day - Sunday, Dec. 25

When holidays fall on a Sunday, the Fed’s banks and branches are closed the following Monday. In 2022, that will be the case for Juneteenth Day and Christmas Day.

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What happens if payday falls on a bank holiday?

In most cases, if your payday falls on a bank holiday, you’ll have to wait for the next business day to get your money. For example, using the 2022 dates, if your payday falls on Martin Luther King Jr. Day on Monday, Jan. 17, your paycheck won’t get processed until that Tuesday.

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If you get your paycheck through direct deposit, you will have access to your funds a lot quicker than those who still get a paper check. However, in most cases, you will still have to wait a day to get access to your funds.

Direct deposits are handled by the ACH (Automated Clearing House) network. The ACH is an electronic network that handles financial transactions like direct deposits and payments for bills, taxes, e-commerce, and business-to-business. The ACH only processes transfers on weekdays, not weekends and holidays.

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It’s important to pay attention to when the ACH and the Federal Reserve are open because that has a more significant impact on whether your direct deposit goes through than the open hours at your bank.

If you’re lucky, your employer will prepare for the holiday shutdown by running payroll early to ensure that you get your paycheck before the holiday instead of after.

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