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Risks of Paperless Personal Finance

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Last week I wrote about five ways that paperless personal finance saves you money and I figured I might as well go over a few reasons why paperless finance may be risky. I’m tempted to slap a Devil’s Advocate label on something like this but paperless personal finance isn’t exactly a slam dunk answer for everyone and here’s why.

Website Down

I don’t know if you remember when Emigrant Direct rolled out a new site design last year and saw their website come to a grinding halt. That was only for a day or two… imagine if the website was down for a week. That’s the number one reason why going paperless is a huge risk, if the website goes down and you can’t get a telephone number, you’re disconnected from some of your funds. The easiest way to mitigate this risk is to avoid putting putting all of your money in one place, good as a general practice anyway.

This is why I always advocate having a brick and mortar bank account that you can access easily in person because nothing beats being able to talk to someone in person if you need a problem solved. I can’t think of a situation where, between an online bank and a B&M bank, you can’t get to your money in a timely fashion if you need it.

You’re Terrible With Email

I use email notifications as a way to remind me to pay the bills and I do so whenever I get the notifications. It’s understandable that sometimes you can’t act on an email when they receive it, thus preferring a paper bill to act as a constant reminder that you have to do something. Ultimately it comes down to priority – how important is it for you to pay your bill right that minute? If you can take a minute to check your email, you can probably take an extra minute to log into your account, schedule a payment, and then continue onto whatever pressing matter it was that you had. Right? Be honest. :)

Print Your Own Records

If you file away everything, from credit card bills to bank statements, then you have more detailed notes than most people and you might be able to justify your need to keep receiving paper statements. All of those records are accessible online, if you can get online, and certainly having the paper record is nicer than having to log on, print, and then have the record so going entirely paperless puts the onus on you to do a little extra work if you need the paper document. This is a trade off I, and many other paperless proponents, was willing to make since I found that I never used my bills or my bank statements for anything.

There you have it, a bit of a bone for those paper finance people who couldn’t see themselves not receiving a paper bill each month, and I certainly understand, though I don’t agree, with where they’re coming from. There are legitimate reasons why you would want some of your statements and not others, but I hope that some of you folks would consider moving some of your stuff to the paperless world and save some of the little trees out there. :)

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8 Responses to “Risks of Paperless Personal Finance”

  1. Lazy Man says:

    I’m a paper-person, however if it’s a consistent cost bill (same every month), I’m fine to set up a schedule once and forget about it. So I would pay my condo fees, my rent, my cable, my phone (Vonage). I even pay my cell phone over the phone since Sprint allows you to do that for free.

    If it’s not a consistent cost bill, I have a harder time with online payments. It means that I can’t just set it and forget it. That means that for heat and electric, I need the company to give me a better option. I’d even give them permission to do an automated withdrawal. I need the same thing from credit cards, but we know this will never happen, since they want you to pay late.

  2. Patty says:

    Lazy Man.
    You said “I need the same thing from credit cards, but we know this will never happen, since they want you to pay late.” you might want to check your credit cards. My chase rewards card does have the the capacity to set up automatic payments to itself. I can choose minimum payment, payment in full or other amount. I can’t find this feature on my citi card.
    Going to go check my Wachovia now, almost missed an on time payment on them as I never use it and( there has a 0 balance for ages) but a much delayed charge of less than $5 from an European trip showed up coupled with the fact they changed my due date significantly could have cost me a late fee.

  3. Blaine Moore says:

    I prefer paperless, but only if I can download a PDF to my local machine (which is then copied in my regularly scheduled backups)…saves the bother of needing the website to access my statements, and also keeps me from having to request old statements from outside their window of availability.

  4. Randall says:

    All the CCs I have do e-bills now, and are automatically paid by my bank. I also have my utilities on level pay (where possible) so they only change once a year and are also auto paid. Other variable bills are paid through Amex (for the points) which is THEN paid automatically by the bank. The only thing I really need to do is put money in the account each month (direct deposit), and it goes where it’s supposed to automatically. I haven’t missed a payment (accidentally) in over 5 years.

    I don’t like automatic withdrawals though, since I don’t have any control over them ultimately. None of my billers can do automatic draws from my account. Car Ins. does automatic pulls from Amex, but that’s as close as it gets.

    I’ve written about 4 checks in the last 3 years (pizza) and only use paper money about twice a year.

    To each their own though. Whatever makes you comfortable.

  5. Lord says:

    Don’t forget about when your computer goes kaput.

    Incoming is paper and outgoing is online but I may eventually go entirely online. Small bills like utilities I used to pay quarterly in advance so I would have fewer checks to write and mail but online there is little need.

  6. MoneyNing says:

    I’m an extreme paperless person. I try not to print any paper at all and try to file everything on my computer. It makes everything easy but I don’t do enough backup so there is a huge risk because my computer can die any day.

  7. Clever Dude says:

    I clearly recall the banks and CC companies stating that going paperless will save them money, which will save you money. Fees and costs have only gone up, not down. So they have pushed the cost and time to print the stuff onto me without passing along any savings.

    I don’t mind so much because I don’t print my statements, etc., but it just stinks that they lied. I feel hurt and abused :( Eh, can’t trust a big business, can you?

  8. jim says:

    You can trust big business to always be watching out for themselves. :)


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