Let’s talk electronic bill pay. This is something that has been around since the mid 90s, but I know many of you still don’t take advantage of it. I honestly can’t tell you when I swapped from writing checks to paying electronically through my bank, but I can tell you I now pay all but one thing via electronic bill pay and that is our tithes to the church…although I could do that electronically, I just like having something to physically put in the collection plate each Sunday.
The reason I am broaching this subject is because bills and the papers produced by them create a mountain of unnecessary paper in your home. Add to that paper checks, boxes of checks, bank statements, etc. and you have a ton of paper and processes that can easily be eliminated.
I choose to set all of my bills as reoccurring payments unless it isn’t something that comes regularly or the change in amount is too drastic (i.e., credit card - we don’t ever have a set amount because we try to pay it off each month). Now, for those things that often change, but the change isn't drastic like our electric, gas and water bills, I put in an average amount as the reoccurring payment.
Note: The two steps above theoretically only have to be done once, unless you are adding a new payee account or changing your reoccurring payment.
When the bill comes in each month, I look at the amount of the bill and the amount in my bill pay area, if they are different I update it with the correct amount for that payment. This step literally takes me 5 - 10 mins, if that, twice a month (my routine is to go into my account twice a month to schedule payments, but sometimes I’m feeling froggy and I schedule them as soon as I get the bill. It usually depends on if I'm at the computer/phone or not at the time I open the bill, whether electronic or hard-copy) You can set your own schedule based on your monthly budget.
So let's evaluate this for a minute because it is a valid concern. If you are living paycheck to paycheck, I would suggest scheduling all the "have to pay" items, I discussed in the budgeting course, through your bank so you ensure they are paid on time and you don't incur late fees. In my example, I get paid twice a month - the last day of the month and the 15th. All of our bills are scheduled to come out around those two dates. Even if the bill is due on the 25th I pay it on the 16th. That way I know once those are paid how much money is left for the rest of that two week period. If your due date is in the middle of that time frame, see if you can get it changed and/or pay it early. There are a number of factors that need to be considered in this situation, but the first step is completing your budget so you know when and how you need to pay your bills. This will allow you to compare when bills are due versus when the money will be in the account. If you still need help after completing the free budgeting course, I recommend, scheduling a coaching session with me to discuss your individual needs.
Well, I much prefer electronic bill pay through your bank over the direct debit system. There is just something about companies having access to my checking account that I don't like. I'd rather an issue be on my end than on a computer or another person's end. I've had a situation where the person entered the information erroneously and debited my account twice in one month. I understand mistakes, but if I had been struggling or living pay check to pay check that would have caused a ton of problems. That being said, I do have a few of those set up because there was no other option offered (insurance/student loans).
With all of the system hacks companies are experiencing these days I can understand why you may be concerned with banking online. I can tell you that they adhere to a pretty stringent security standard and I have never felt compromised when it came to online banking. Also, banks are FDIC insured so your money is protected (up to $250,000). I would say if you are concerned to contact your bank and discuss how they protect your online data and your account.
All in all, you can decide what method of online payment you want to test out, scheduled payments or reoccurring payments. It is just one more way you can eliminate clutter in your home, streamline and better manage the bill paying process and set up a system to better control and organize your life.
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