When Should You Use Automatic Bill Pay

I’m a fan of automatic online bill payments. Having a payment automatically deducted from my account every month is convenient and environmentally friendly. No paper statements to wade through, no need to remember a due date, and no checks to write. However, automatic bill payment isn’t the best choice for every bill. Many of my service providers give me the choice between automatic, recurring billing and “manual” online bill payment where I give the authorization for the payment each month. For many of my bills, I choose the latter. Why would I choose to enter the payment each month when the convenience of recurring billing is available to me? Because there are certa

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9 Responses to When Should You Use Automatic Bill Pay

  1. gertymac says:

    I autopay all of my monthly bills. I receive an email notification when my statement is ready (for everything except the mortgage) and can review my bill in detail before the autopayment is made. This gives me the opportunity to double check the variable bills, like utilities, before it’s too late but still rely on the convenience of autopay.

  2. Kyle says:

    Quick story that made me change my approach. I was renting one apartment and paying each month via an automatic withdrawal. I figured it was a fixed monthly expense so it would be nice to not have to think about it. When the lease neared its end, I was planning on moving elsewhere. The last payment was supposed to be for 1 week. Somehow a mistake was made and they withdrew a month’s worth. I had to fight really hard to get them to admit the error after speaking to several “managers” but wasn’t actually repaid until i received my deposit back two weeks later. Paying a full month’s rent plus the first month and deposit at the new place almost put me in the red and made moving very complicated. Now I only use it for a few very small fixed expenses. When mistakes are made, I’d much rather have my money that have to fight to get it returned.

  3. It’s good until the cash flow gets squeezed, than it complicates matters.

    John DeFlumeri Jr

  4. Hilary says:

    I have one credit card that does not autopay, whereas everything else does (utilities, other cards, etc.). So that actually causes me some problems, since I am so used to everything being on autopilot. I’ve never missed a payment, but I’ve come quite close. I just wish everything could be the same so I didn’t have to worry about it.

  5. Jackie says:

    When I had a car loan, I had that set up to automatically pull the payment from my checking every payday. It was easy to remember since I would record the withdrawal at the same time I recorded my check’s deposit. However, I would never set up anything else the same way. I have my student loans set up as an automatic payment from my bank, but it’s simply a series of online bill pays that I have made recurring. If I’d known I could do that same when I have a car loan, I would have. This way I maintain complete control of my money flow, no matter what else is happening in my life or with the business I owe money to.

    Setting up my account to make an automatic payment, fine. Setting up to let a third party make an automated withdrawal, not so fine. But then, I’m a bit of a control freak when it comes to money. :)

  6. Joy says:

    I autopay my credit card bills now, too, but with what is twice the anticipated minimum payment amount. This is SIMPLY to guarantee I never get a late fee because, as a previous poster noted, it’s easy to forget when everything else is autopay. Then, I just do the payoff of the balance if able. But this keeps the stress of $39 late fees away.

  7. Gail says:

    Because we run a business from home, I want to have copies of all utility bills, etc. as proof of expenses. I may pay the bill on line, but I won’t put it on automatic withdrawal except for the mortgage and my Medicare supplements. Our garbage company sends out a bill quarterly and has now decided to bill us $3 for the privilege of getting the bill in the mail, but to choose to pay on line, there is only the one option of automatic withdrawal and as they tend to make mistakes (including to forget to pick up the garbage itself) and every bill is different depending on the fuel surcharge they decide on, I’m not about to let them come in a scoop out money without me knowing and budgeting for it. I’l rather waste the $3 each quarter.

    Unfortunately I feel that soon most bills will be required to be paid on line with either a charge for paying on line or a charge if you don’t. Wonder how those companies ever made any money back before computers did all the work for them???

  8. Jo/GaelicWench says:

    I tried using automatic bill pay once and that went over like a lead balloon. Lesson learned. Now, however, since I am using the snowball effect on paying down debt, it makes sense to do so. I still have to keep a very close eye on the dates my cc payments are due, because as Jennifer stated, they tend to change everything ad nauseum. Next thing I know, I have charges for a late fee or not paying enough. They simply cannot be trusted.

    I also learned to use bill pay from my checking account online. I’ve heard and learned not to trust the companies – CCs, utilities and a few odd ones.

  9. priscilla says:

    I use online billpay w/BOA.This works well for me.I check each bill before I authorize the payment.The bank alerts me when each bill comes in. The companies that won’t do a direct bill to BOA send bills to my e-mail except for the water co.All bills get paid thru the bank.I have no credit cards so I don’t have to watch for their changes.

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