Smart Bill Pay Tips for Families Online

In the analog days before personal computers, the Internet, and smartphones, paying monthly bills was an event! Bills would arrive in the mail and be picked up at a specific location and saved for that special day each month that they were paid. Invoices were reviewed to ensure all expected items had arrived and each check was written with a corresponding entry added to the (paper) check register. It was a hands-on exercise that required good organization, basic math skills, and concentration to ensure the accounting was recorded correctly. Mailing the checks and tracking them through the register was not the end of the process: it was imperative to examine the monthly bank statement and balance the checkbook to make sure there were no math errors, the checks had not been lost in the mail, they were actually cashed by the creditor and correctly credited to the account. Because there was always a delay between the bills being due and the bank statement arriving, it was sometimes difficult to avoid unpleasant situations such as the electric or telephone company threatening to disconnect the service due to a clerical error or delay. at the post office.

Since then, things have changed drastically. First was the introduction of financial software that could help with monthly budgeting and paying bills. Computerization increased organization and reduced mathematical errors, which made it easier to control monthly obligations. Today’s consumer has a wealth of tools at their disposal to pay bills, keep track of bills, and keep their personal finances organized. Instead of a shoebox full of paper and a checkbook, bills can be paid with an Internet-connected computer or smartphone. Payments made with a checking account or credit card can be monitored in near real time. Even the role of the post office has diminished considerably due to changes in the bill payment process. Many people use automatic bill payment options that are available directly from providers like the phone company or insurance company, as well as many banks. Consumers may still have a checkbook in their possession, but more often than not it gathers dust on a shelf or in a drawer while bills are paid in other ways.

Automatic bill payments are the most convenient of all, with options to pay each vendor directly from a bank account or credit card. Autopay is great for convenience and flexibility, but the onus is still on each consumer to ensure the process works as expected and to stay in control of their finances. What are some things to keep in mind with automatic bill pay, and what are some tips for staying on top of your budget while taking advantage of available automation?

• Choose the payment method that suits you best: Many people find it more convenient to set up their automatic payment on a credit card instead of having the money instantly deducted from their checking accounts. That way, monthly bills appear together in one place and there are fewer worries about cash flow during the month. And with credit card accounts accessible online, the balance can be checked as needed. Many credit cards may offer consumer benefits such as frequent flyer miles, free merchandise, and other perks. Using a credit card as a payment method is great for organization, but beware! Piling up charges on a credit card makes it easier to go over your budget and get into trouble at the end of the month. Only use this method if you’re prepared to pay off your credit card balance each month to avoid paying high finance charges on your fixed monthly expenses. If you’re on a tight budget or having trouble limiting credit card spending, paying bills directly from your checking account is a better solution.
• Be prepared for changes: When you use a credit card to pay most monthly bills, if your credit card is stolen or hacked, or when it expires and a new card is issued, keep in mind that any automatic payments you set up with that card will no longer be will process. Keep a list of accounts using autopay, including the credit card used as the payment method for each account. This way you can quickly update them all when a new credit card arrives. If you’re tempted to review your most recent statement instead of keeping a list, remember: some bills are monthly, some are quarterly, and some are yearly, so they won’t all appear on your most recent statement. Maintaining a list is the most efficient way to easily update all applicable accounts.
• Stay involved in the process: Many banks help with the process and provide alerts when an expected bill arrives or doesn’t arrive as scheduled. Bill Pay is a great feature of online banking and can help you stay on top of your obligations! Take the time to review your bills each month to make sure there are no unexpected or erroneous charges; especially if you’re on a tight budget and paying directly from your bank account. Unexpected charges that are automatically deducted from your account can cause unexpected drops in your bank balance.
• Be smart when it comes to cash management: If possible, don’t set up automatic payment on bills that can vary widely from month to month, such as credit card bills. And always avoid paying off the balance on one credit card by adding it to the balance on another.
• Keep your credit score up to date: Due dates for items like credit cards, health insurance, mortgages, and car payments are typically due on the same day each month, making it easy to ensure auto-pay bills arrive on time. However, the due date of some invoices may vary. Make sure the payment date you set for each bill allows enough time for the creditor to process the payment to avoid late fees. Similarly, if you use your bank’s bill payment service, for some providers there is a delay between the date of payment and the date of receipt; Be sure to allow enough time to avoid late fees and avoid credit problems.

The most important concept to remember is that although bill payment has become extremely convenient and paper cuts are much less common these days in the bill payment process, you are still ultimately responsible for your finances. your bills and your credit rating. Monitor closely, take advantage of the online tools available from your bank and creditors to help you keep track of your finances, and remember to dust off that checkbook from time to time. Regardless of the method you choose to pay your bills, it is strongly recommended that you keep an up-to-date record of all checks and debits, making a deduction for each item immediately (as soon as you have issued or authorized an item for payment), including any associated fees. This will allow you to have an accurate and up-to-date checking account balance to work from. This will also help prevent incidents of insufficient funds and their associated fees. Accurate and timely account records never go out of style!