Personal Finance 

How Online Bill Payment Adds Months To Your Life

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Back in the days of personal checks and monthly bills, “doing the bills” was an arduous task that took hours and hours. Back in the days of check registers and balancing a checkbook, “doing the bills” was like accounting-lite. With the advent of online checking and electronic bill payment systems, there isn’t any logical reason why you should be spending an hour or two each month dealing with bills. By setting up your bill payment details and conducting your transactions entirely online, you can add months to your life.

Thank about this… imagine you spend three hours a month dealing with bills. Three hours a month equates to a day and a half a year. That’s basically one weekend a year (unless you do your bills at work!) you lose because you are “doing the bills.” Now consider that you’ll be doing bills for most of your adult life. If you figure you live past 75, you’re talking about over a year’s worth of weekends lost just to “do the bills.” I think that when you put it in those terms, it’s quite easy to make the jump and trust online bill payment as a means to recapture your weekends.

Personally, I auto-pay as much as I can. My cell phone bill and my cable/internet bill are charged to a credit card while my mortgage and my water bill are all automatically debited from my checking account. I’m implicitly trust those entities because they’re established organizations (Sprint, Verizon, BB&T and my county government) that I would trust my banking information to. If I didn’t, sending them a check would be just as dangerous as giving them the electronic account details (I lose nothing privacy-wise by giving that information to them versus a personal check).

If I could auto-pay the balance of my credit cards, I would. I can’t do that because the credit card company doesn’t offer it because that would mean I’d never miss a payment. I’d never miss a payment and I’d always pay off in full, something I do anyway but at least this way there’s a probability I’ll miss it (and I have in the past, I’ve missed one payment but had the fee waived).

{ 12 comments, please add your thoughts now! }

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12 Responses to “How Online Bill Payment Adds Months To Your Life”

  1. I totally agree that paying the bills like this can save time. It can also help you manage your finances and is especially good for people who are likely to forget to pay bills on time.

  2. Wow! To be honest, I am very surprised to hear you give all those companies the right to deduct any amount they please from your accounts. While I agree that our banking information is _generally_ safe with those companies, I in no way would trust them enough to automatically charge me every month. I can recall at least half a dozen times when Sprint, Verizon, and Comcast have incorrectly charged me (including a $357 overage charge from Sprint when they mistakenly changed my account plan).

    I’d much rather spend 5 minutes per company once a month going over the bill than being gouged by something like that. And I can’t begin to fathom having my credit card bill automatically paid for each month, with all the issues we have with identity theft and unsavory companies fond of monthly billing.

  3. Glenn Lasher says:

    Sorry, but I just don’t trust the system enough to allow it to handle my money without my being inserted into the process. I have seen and heard too many stories of ACH transactions going wrong, and I have had it happen to me. As such, only those organizations that require ACH payment get ACH payment, and then only after much protest to try to avoid it.

  4. RCee says:

    I paid all my bills and reconciled the balances in about one hour this morning. I’ve been doing electronic banking for at least 10 years and only had one problem. I used to let companies ‘pull’ payments from my accounts but no longer. Now I ‘push’ all payments using my bank’s free online bill payment service. The problem was when I changed banks and got a new checking account. I called my utility company to update their ‘pull’ information but they couldn’t turn off their draw from my old bank. They had just switch computer systems and my account was in limbo. They said to sign up for the new system but it wouldn’t let me because I was in the old system. It took about a month for them to straighten it out.

    Online banking is good, but don’t let companies take money out automatically. Schedule your payments with your bank’s bill payment service. Otherwise you are at their mercy.

  5. Traciatim says:

    I agree with Glenn and Jon. Though I don’t let automatic payments happen, I do have all my bills set up in my bank account and manually pay them when they come in. This way I look over the bill at the time. The whole process is less than 5 minutes a bill (probably less than 3).

    I have a great story about trusting a bank with an automatic withdrawal. I was setting up an education fund at a bank that I don’t normally deal with. Since I didn’t have an account there I figured I would bring a cheque for my initial deposit, which was a grand. They set up the account, and cashed the cheque and then also ACH’d my account for the grand . .. TWICE. It threw my account in to a spiral since I was planning on 1K, and 3K tried to come out.

    I mean, that was just an honest mistake, and they paid for any fees incurred of course. It just solidified my theory of keeping my bills non-automatic, but online accessible. All it takes is for one type-o to happen and your power bill goes from 349 to 3490. I’d rather see that on a piece of paper and call them than see it come out of my account instead.

  6. I’m with Jim/BfFP on this one… I automate everything I can and pay electronically wherever and whenever I can. I think you can alleviate some of the risks mentioned by flowing most things through credit cards. I then use bill pay through my bank to pay off the credit cards, so I agree with RCee on that. In the few places that I have allowed deductions straight from my bank account, I have not had any problems (knock on wood).

  7. Saving Freak says:

    We prefer to automate everything to a rewards credit card. This way we know what to budget for when it comes to utilities, gas, etc. This makes the budget very easy to fill out at the beginning of each month. Plus we get the 1% to 3% back on everything.

  8. I do the exact same thing, I have all of these automatically deducted. For those of your worried about an over charge or miss billing, I receive the bill well in advance of the debit to my account so I’m able to confirm everything is correct. In the rare case it wasn’t I can easily stop an automatic payment.

  9. Stngy1 says:

    I’m there with RCee. I’ve commented on this before, but to be redundant:
    By using a billpay service (Paytrust) everything is centralized; I control the date/amount, and it still requires (after setting everything up) only moments of my time. Paytrust emails me with all bills it receives, amount due, etc. I have set amounts I pay to all utilities and, in truth, all credit cards. Sometimes I overpay utilities, sometimes underpay; doesn’t matter since I can carry a negative balance from month to month. Its worth the pennies I might lose in interest to even out payments. Credit card payments I usually base on what would be “minimums” for the entire credit line. I know some would cringe at this, but interest rates on all our cards are less than prime, mostly fixed, and carry only balance transfers. I only use one for purchases, and its part of a monthly budget, so I limit it’s use to budgeted amounts which is factored into its monthly payment.
    The “thrill” comes in paying a fixed amount every month, on ONE set day a month.
    I am in control, I know and have COMPLETE charge of my budget.
    I chose to go with an independent billpay service because I could use multiple funding sources, I have ALL my records (online & on disk once a year) for several years now, and, best of all, my banks don’t know my business.

  10. jim says:

    John, Glenn: I agree with you in that autopay may be risky but I mitigate that with my credit card so that a strange $300 charge hits a credit card and not my bank account. I get time (and some credit card muscle) to back me if I have to dispute it. However, your experiences do concern me so perhaps moving to a push method (it’s only a few minutes more time) may be better. Thanks for the comments!

  11. Zook says:

    I have been doing banking online for years and years and have done thousands and thousands of transactions online. Just sold a car online and bought a car online.

    It is clearly a divide between the young and old on this topic.

    I would like to know how I can get scammed by paying a Direct TV bill from my Wells Fargo, Bank of America etc. etc. bank account on my terms and when I say to send the bill?

    What is the scam? Maybe I am clueless here, but exactly how does it work?

    I can tell you one thing. Using bill pay has saved my probably a thousand dollars in stamps and has made me far more focused on saving. If I have an extra $3.75 in my checking account right now, I can send that off to my brokerage company. Never mind writing a check and buying a .41 cent stamp. I simply send it off.

  12. Bruce Huie says:

    Big applause to any financial institution offering it’s customers a “paperless solution” that increases convenience and simplicity of online bill payment.

    I agree with Stngy1 on keeping a “seperate set” of records outside of the banks as personal comfort. Each of these online payment transactions generates a confirmation and/or an entry on a monthly statement. As paperless transactions become more pervasive, a few important considerations that are often overlooked when consumers go online and paperless. These include the effort required to collect documents from a range of web sites (many consumers have accounts at different institutions for banking and brokerage transactions), authentication of document originality, document security, centralized organization, secure availability of documents with a registered “investment advisor” (e.g. tax accountant) and then disaster recovery in the event of fire, flood or earthquake as illustrated with the California fires last year.

    I am an account holder at 4 financial institutions and carry 6 different creidt cards – all paid online. Since I travel alot for business – away from my home and need to pay bills, I use online payment alot. I think as financial services consumers seek to reduce paper clutter and streamline their financial lives, the need for an easy-to-use, convenient and secure service with a flexible set of financial management tools becomes more critical.

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