Today, I discovered our AOL billing information. Turns out we’ve been paying for dial-up via automatic bill paying that we thought we cancelled in 2000. $1,800 later, we called to cancel. Customer service congratulated us on being loyal members for over 13 years. FML -Jay
- Image by roberthuffstutter via Flickr
I am a huge fan of automating my finances. My paycheck is direct-deposited. My savings are automatically transferred from my checking account to my savings account. Almost every bill I receive regularly is set up as an automatic payment in my bank’s bill-pay system. I even have my debt snowball automated.
The only question left is whether it’s possible to automate too far. Can you automate past the point of benefit, straight into detriment? The primary benefit of automation is knowing that you can’t forget a payment. The other benefit is freeing up your attention. You don’t have to give any focus to paying your bills, freeing you to worry about other things.
The problem with the second benefit is the same as the benefit. If you don’t give your bills any attention, how do you know if there is a problem? If something changes–an extra fee or a mis-keyed payment–you won’t notice because you haven’t been giving the bills any focus.
Sometimes, this means you are paying an extra fee without noticing it. Sometimes, if your due date changes, it can mean late fees. Even if nothing goes wrong, you are missing the opportunity to review what you are paying to ensure your needs are being met as efficiently as possible.
What can you do about it? I put a reminder on my Life Calendar to check my bills each month. I pick one bill each month and try to find a way to save money on it. I review the services to make sure they are what I need and if that doesn’t help, I call and ask for a lower price. If it’s a credit card, I ask for a lower interest rate. For the cable company, I ask if they will match whatever deal they have for new customers.
Every company can do something to keep a loyal customer happy. All you have to do is ask.
Do you automate anything? How do you keep track of it all?
I automate almost everything. All of our bills are automatically paid, our checks are direct deposited, my 401(k) is automatically funded, our and Roth IRA automatically grabs its money every month.
I do not automate the credit card payments. I check each of our rewards cards statements line by line before paying them off every month. I also balance our checkbook every 2 weeks or so to make sure everything is above board there as well. I also check all of our emailed and mailed bills as they come in to make sure nothing seems out of whack.
This combo keeps us in the green with late fees (I’ve never had one) and gives me the control I need to make sure we aren’t being taken when we’re not looking…
I definitely agree. I don’t budget and we automate nothing. I even still demand paper bills for the credit card, even though I pay them online. Not being automated means I check the utility bills in detail which has pointed out a broken sprinkler head or leaky toilet on more than one occasion. I’ve also caught inappropriately charged fees. I don’t like the idea of their mistake meaning my checking balance is below what it should be.
I *do* automate the cell, netflix, and the internet– these charge the credit card, which adds an extra layer of protection, a little more time to adjust, and a second time for me to notice the expense. I would probably automate more if they pulled from the credit card rather than from the bank.
Things I don’t want to think about (long-term savings) are automated and checked quarterly or once a year. These get pulled from my paycheck, not from the bank, except the 529 which pulls from savings instead of checking.
@Nicole, I’m surprised more places don’t take credit cards for free for you! The only bills that get automatically deducted from our bank is our mortgage, $30 or less water bill, and $110 car insurance – everything else is auto-charged to our credit cards, even electricity…
I run it all through the bank, so I have absolute, hassle-free control.
BFS– When you don’t live in a city…
Utilities will pull the bank but won’t charge to a credit card.
A lot of utilities still charge a fee for the credit card payment. It’s dumb, but they do it.