By your thirties, there are some serious bills to keep track of that may not have been around before.
For the first time ever, I’m dealing with my own internet service bill (that bill has always been in someone else’s name before, though I did have to pay into it) and my own electricity bill. Then there are small bills that come up frequently such as my Hulu bill, and the infrequent website hosting bills for multiple websites. There are credit card bills and student loan bills, plus of course, the ever-present rent bill.
Because my schedule can get really busy (as I’m sure yours does as well), I’m a huge fan of automated payments. They’re a great way to make sure you don’t forget a payment, and incur late fees, which can add up- or worse- hurt your credit score!
The financial advisor Suze Orman recommends automated payments highly. But when I went online to do research for this article, I noticed that a lot of advisors were on the fence about automatic payments. If you set up autopay for something and then never check it again, you’re definitely taking a risk. You have to make sure you’ve set up autopay for the correct date, so your account doesn’t get overdrafted when your Cable bill is automatically paid right before your paycheck comes in. It’s always possible that you’ll set up autopay and then get overcharged or have a fraudulent payment go through- if you never check your statements and bills, you won’t know about these issues, and therefore automated payments could cost you money. But all you have to do is occasionally check in on your autopayments, and they’ll more than likely save you money…and will definitely save you time! If you simply make it a process to check on things occasionally, I think automated payments are almost always the best way to go for busy thirty-somethings.,,definitely great insurance against late payments!
Some bills are better for automatic payment than others, and some payment setups should be different for different bills. Below are some automated payment tips so you can better use automatic payments to your advantage:
- For repeated payments that will be the same every month, autopay is the way to go.
These payments include things like your student loan monthly minimum, subscription to Netlix, Pandora, Spotify, Hulu, your website hosting service, etc. If the payment is the same every month and never varies, automatic payments are a no-brainer. You very likely won’t be overcharged. Take payments off your to-do list and automate! All of the above subscriptions and payments have a repeating direct debit option.
- For repeated payments such as your rent or mortgage payments, autopay would be a great way to go if it’s available.
Not all homes or buildings will allow you to autopay. Check with your building management company, mortgage lender, or landlord and see if there’s any way to set something up.
- For variable payments, such as credit card bills, a minimum payment autopay is usually the best way to go.
You can also have the full amount owed on your credit cards completely paid every time. Whether you automatically pay just the minimum owed or the full amount owed on credit cards completely depends on your comfort level and how you feel. I have the minimum owed Autopayment scheduled every month, but I’m always checking in on my credit cards and paying them in full a couple of times a month anyway. I watch my credit card statements very closely. I’m thinking about changing my system to automatically pay the full bill every month as an even bigger backup system against any interest possibly accumulating. If you’re not afraid of a possible overdraft and don’t wish to keep a close eye on credit card statements, you can probably just do an automatic payment in full every month on all your credit cards as well. Or else make sure you set up Autopayment for the minimum due. Then you won’t get hit with an accidental late fee and a hurt credit score.
- For variable payments such as electricity bills, internet, and cable bills, I still think autopayments are the best
This is where opinions really differ online, especially with electricity bills sometimes varying so widely in the very hot and very cold months, you can sometimes get socked with a bill you weren’t expecting. Also, if you’re overcharged and you’ve used autopayment, charges will take a little longer to dispute. I still think it’s worth it to not have to think about these payments- just check in on everything from time to time.
- If you have a credit card that earns points or miles, see if you could use that to make automated payments, as opposed to just paying straight from your bank account
Getting paid in points and miles to pay my bills? Um, yes please!
Now sit back, relax, enjoy, and pretend you have a whole team of people paying all your bills for you, and you don’t have to do anything but concentrate on more important things…like your creative endeavors…and your next vacation. Yes!
Feels good, doesn’t it? 😉