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Save Money When You Automate Your Finances

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These days, you can pay your mortgage or rent, utilities, insurance, loans, and credit cards every month without lifting a finger. Automation is a great time saver—and it can also reduce your vulnerability to identity theft. However, make sure you use it wisely.

Getting started

There are few different ways you can use to automate paying your bills. The most convenient option is to use your credit union’s bill-paying service. Log into your checking account online, input who, how much, and when you want to pay, and your financial institution sends an electronic or paper check. You can do it as a one-time thing or set up recurring payments. Once you’ve set up a payee, you can also pay your bills using the Sound mobile app.

Another way to automate is to set it up directly with your creditor or service provider. Generally, all you need to do is let them know when you want the payment taken out of your checking account and submit an authorization form. For some bills, you may also have the option of having the payment charged to your credit card. To avoid interest, don’t charge more to your card than what you can pay in full the next month. You can also use a third-party service to pay your bills, but it generally does not make sense to shell out money for this if you can use one of the other two options, which are usually free.

Avoid complications

Putting your bills on AutoPay does not mean that you can completely forget about them. First, you want to make sure that you have enough money in your account to cover the withdrawals. If your $1,200 mortgage payment is supposed to be deducted, but there is only $800 in your account, then either your account will become overdrawn when the debit occurs or the debit won’t occur and the bill won’t be paid. Either outcome can result in fees.

You also want to verify that the withdrawal actually occurred when it was supposed to. Mistakes sometimes happen, and you are still responsible for paying your bills on time even if someone else messed up. Don’t forget to review your statements too. If you don’t, you may miss an unauthorized charge or notice of a change in terms. Lastly, if you close a checking account or credit card, be sure that you update your bill-pay information so that future payments are assigned to your new account.

Article provided by BALANCE

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