Today we welcome our regular Thursday contributor, Daisy Flower.
I am one of those people who resisted automating my bill payments for quite awhile before I jumped on the bandwagon. For me, it was the principle of having to go to each of my service provider’s websites or branches and set up the automation. I told myself that I didn’t have the time, when in reality, it was pure laziness.
When I finally woke up and automated the payments, it was a load off of my shoulders. See, I used to forget to pay bills sometimes. I wasn’t deferring the payment because I didn’t have the money for it, but I would get the paper bill and because it wasn’t sitting in my email inbox to remind me that it needed to be paid, I’d forget all about it. Then I’d get a message from my service provider reminding me that my bill was past due.
Automating your bills is the best way to ensure that they are paid on time and in full. There are so many ways that automating my bill payments has made sense:
It Saves Time
Sure, it took a couple of hours out of my Saturday afternoon to go automate all of my payments, but after that, I never had to go and do it again.
My excuse that I didn’t have time to automate my payments was invalid, because I would only have to go to the website of the service provider once, or place one phone call to set up the automated payment system. If you don’t automate, then you have to take time every single month to pay your bill.
It Saves You Money
Listen, we’re all human. We can’t all be on top of everything, all the time. If you’ve never forgotten to pay a bill, then I applaud your organization skills. Many service providers charge you a late fee for paying your bill late. Some are kind enough to give you a courtesy reminder before dinging you, but many are not.
Even if it saves you only $5/year in late fees, that’s still $5/year. Furthermore, many companies offer discounts if you automate the bill payment. My Internet provider gives me a $5 discount/month to automate, and our electricity company does as well.
You Have to Pay It Anyway
It’s interesting to see advice that one should only automate bills that are of the same amount each period. While that may give you some piece of mind, you have to pay the bill anyway, even if it’s more expensive from one period to the next.
If you are reading this, chances are you are interested in personal finance, so any discrepancies in your bills (ie if you are overcharged) will be discovered when you review your budget and spending.
Automating Bills Protects Your Credit Score
When I was 18, I signed up for a gym membership. The gym didn’t send bill payment reminders. If you didn’t pay your bill, they might remind you next time you went to the gym and they saw it on your account, but that’s it.
I only used the membership sporadically and forgot to pay my bill one month. A year later I got a call from a collections agency. My credit score was hurt (albeit marginally) because I forgot that bill payment.
Do you automate your bill payments? Why or why not?
*Editor’s Note* P.S. While Daisy makes a strong argument for automating some of your bills, I think there is a strong argument against automating your bills, too. In the end, it depends on which method works better for you, but consider both sides of the issue!