Online Bill Payment
It’s a chore to sit down each month and pay all of your bills by check. It takes a great deal of time, postage can add up and writing checks can be a pain, besides, it’s a thing of the past. Modern technology and the internet have made checks, pardon the pun, virtually obsolete. The majority of utilities, credit card providers and other merchants allow for either online bill payment or even monthly automatic debiting of your checking account. Many banks have bill paying services for reoccurring bills and a number of third party bill paying services are appearing. The point is, with all that is available there is no need to waste a day or two of your month writing checks and mailing them to pay bills. However, before you jump into the water, there are a few basic points of which you should be aware. You will find that a bit of knowledge will save you tremendously down the road.
The first thing to do is to make sure you have a handle on your monthly bills. You should know what is due and when. Know what bills are reoccurring, like phone bill or cable. Then determine if you will use your bank’s service, the merchant’s system or a third party.
The process is simple. You tell your bank or the bill paying service what bills to pay and they handle the transfer of the funds electronically.
You want to understand when the bank making the bill payment for you withdraws the money from you account. Some of bill paying services withdraw the money up to a week prior to the payment being made. This allows them the ability to earn money on the interest, but also removes what is referred to as the “float” from the bill payment equation. It also means money comes out of your account sooner than you may have expected. No longer can you write a check at a point when you have limited funds in your account in anticipation of your paycheck being deposited before the check for the bill is cashed. Find out up front when the payment is made to avoid your account becoming over drafted. The same also holds true for automatic withdrawals for regular payments your bank may make. Remember what is being automatically withdrawn so you don’t end up with a negative balance in your account. On the subject of automatic withdrawals, it is important to watch these, but it is equally as important to use a bill paying service that will allow you to set up advance or reoccurring payments. This is part of what makes online bill paying so beneficial.
Next, be prepared to monitor your bills and ensure that they are getting paid. This is where it is important to have a handle on what your bills are. Some bill paying services, even banks, send out email notification before the bills are due; however, it is not unusual for over aggressive spam or junk email filters to be attracted to these bank emails and grab them before you get them. The simple solution is to be aware of the bills you have due and then monitor their payment though the bill paying service. This will take a fraction of the traditional time and will give you peace of mind that your bills have been paid. However, another benefit of online bill paying is having confirmation that all of your bills have been paid emailed out. Make sure your service offers that and that you take advantage of it. To remedy the spam filter problem, enter the domain name of your bill paying service into your list of trusted sites that will not be sent to spam. As obvious as this may sound, also make sure to regularly check your email for bill related notices.
It is also a good idea to periodically download records of your bill payments. Many of the online payment services don’t keep the records indefinitely – some will only keep them six months. Download them to an electronic file on your computer or print out a hard copy for your records.
You will also want to verify upfront with the bill paying service who will be responsible for mistakes or failure to pay the bills. Some services take this responsibility, others leave it for you. Ask before it is a problem, so you don’t end up fighting over this and a missed payment.
You will also want to make sure to check the privacy policy for the site you end up using for your bill payments. While the site certainly should not provide any reference of your financial information, it is not unusual for a site to share demographic information and other non-private information about you to other sites. Make sure you understand the level of privacy the site provides and opt for the maximum allowable at the site. If you are not happy with what is provided, look for another site.
When you do pay bills online, be careful to watch your key strokes. Don’t enter $1000 when you meant to enter $10.00. Also, only use a secure server. Don’t pay bills from a hotel room, an internet cafÃ?© or other place with an open connection. Hackers watch these spots and will gobble up your information.
Keep your passwords and login id’s stored in a separate, non-electronic file, so they can be accessed incase you forget your login. Also, make sure passwords are a mix of numbers and letters with a mix of upper and lower case. This will make them even harder to hack. You will also want to review your electronic statements and payment confirmation as if they were regular bills. Make sure all charges are valid and all payments are proper.
Finally, many of the services charge a fee for the payment of the bills. Learn what this is upfront and shop around to find the best deal for you.
