Are Automatic Payments For You?

It seems like the older we get, the more bills we need to pay. Maybe you’re paying for your cell phone, student loans, or you’re even tackling your first mortgage. Whatever it may be, you probably want the payment process to be as painless as possible. Setting up automatic bill pay makes paying bills that much easier, as you can set it and forget. While there are certainly advantages to signing up for automatic bill pay, there are drawbacks as well.



Convenience - Instead of having to visit several different websites or search through piles of mail at various times of the month, payment will automatically be applied to your bills. It’s easier to stay organized and you don’t have to worry about finding the time between work, classes, and cooking dinner to sit down and pay your bills.


Reduced Chance of Identity Theft - If your bills aren’t being mailed to your home, and you’re not mailing in payments with credit card or checking account numbers, you’re reducing your risk of identity theft. According to the Federal Trade Commission, 400,000 Americans became victims of identity theft as a result of stolen mail in the past year alone.

Screen Shot 2017-12-05 at 8.15.38 AM.png

Helps Improve Your Credit Score - You're payment history makes up 35% of your credit score – the largest contributing factor. Automating your bills helps keep you on time with your payments and avoid delinquency.


Overdraft Fees - Yes, you still need to make sure you have enough money in your account to cover your automatic payments. If an automatic payment attempts to draw money that you don’t have, you may face overdraft fees. Luckily, you’re allotted two “oops refunds” annually with the Free4Me checking account, but it’s good practice to not rely on it too heavily. Create a budget to stay on top of your account totals, as variable expenses like utility or cell phone bills keep you on your toes.

Stopping Payments - You might end up paying for things you no longer use if you don’t cancel your automatic bill pay. Consider reviewing all of your auto-pay expenses a few times a year to ensure that you’re not getting charged for that gym membership that you haven’t used in months.

You Might Get Too Comfortable - When you aren’t physically paying bills yourself, it’s easy to become a little too carefree. Make sure you’re still reviewing your bills to make sure they’re correct, as you don’t want to be losing any money without knowing. Also, mistakes happen. Automation does sometimes fail, so stay on top of things to make sure payments are going through smoothly.


I use electronic alerts that let me know when I have a low balance or when a payment is due to ensure that all of my auto-bills go through without any issues.

Do you use automatic bill pay? Let me know!

Take care,