How To Make Automatic Payments Work To Your Advantage

October 20th, 2008 • Related • Filed Under • by tisha

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With today’s technology, it takes almost no time at all to catch up on and keep up with your monthly bills. Not only is paying your bills on time each time essential to your credit rating, it is also important if you are interested in keeping the most money in your pocket. Additional fees and charges that are tacked on to a balance from a late-paid bill is taking your hard earned money out of your pocket. If you are late paying bills simply from forgetfulness or disorganization, then automatic bill pay may be a money saving solution.

So many companies are making it easy to pay bills online automatically. Each different company may have a different set up process or other requirement necessary to set up an automatic bill pay. As with anything, there are some rules to live by when dealing with automatic bill payments.

Here is a list of things to keep in mind when considering the set up of automatic payments.

Check for the Charges

There are certain banks and companies that will charge an additional fee for the convenience of paying a bill automatically. There may be administrative costs associated with the transaction or it may simply be considered an outright convenience fee. There may also be some credit card companies that charge a fee to pay a bill automatically using the card. It is wise to read all of the fine print before committing to setting up an account.

Double Check the Transactions

Just because you are set up for an automatic bill pay situation, doesn’t mean there won’t be errors. Always keep an eye on the due dates, balance amounts, and the last payment received information on your monthly statements from both the company you are paying and the credit card company/ bank you are using to pay the bill. Make sure both sets of statements show accurate payment information. It is your responsibility to ensure your bills are being paid on time, every time; otherwise it is your credit that will suffer. Also, keep tabs on your balances and make sure there are no payments being withdrawn automatically on an account that has been paid in full.

Ensure Your Funds Are Available

When you are using your bank account for automatic payments, make sure you keep up with your checkbook so you do not go overdrawn and incur even more charges. If you are using a credit card to pay your bills, make sure you pay off your balance each month so that you never go over the limit. In the event the funds for bill payments are not available, you risk double charges from both sides of the fence.