Is It a Good Idea to Use Automatic Bill Payments
Many people may have heard of automatic bill payments. You may be using it already to pay for your phone or credit card bills, but some are still not sure though if this is such a good idea.
Automatic bill payment is worth considering
People are often afraid of possible security breaches when making transactions in the web. Let us give you a rundown of the most important pros and cons so you can decide for yourself if it’s a good idea to use automatic bills payments.
Convenience is the utmost advantage
It’s a very convenient way of paying your bills. This is probably the main reason why people thought of creating this method of payment. We usually go through the process of paying for these bills, again and again, every month, issuing checks or going to a payment website to make payments. With automatic bills payment, all you have to do is set it up once, and let the automation do the payments for you.
If you automate your bill payments with your bank, it could improve your credit score.
Financial transaction breaches could happen online from time to time with banks, but technology experts nowadays implement robust security measures to prevent such attacks.
The disadvantages could cost you more money
Getting overdrawn on your account is the main risk when you automate bill payments. It’s also possible that at some point, you’ll have insufficient funds to cover all the payments. This could happen if you don’t monitor your accounts regularly.
You could end up paying for additional fines and fees because your bank account is getting overdrawn as well as your payments not getting paid on schedule. This could negatively affect your credit score.
You may end up paying for the mistakes of other people. It’s possible for any of the service providers enrolled in your automatic bills payment to make a mistake on your bill and overbill you. Since you pay automatically, you may end up paying without knowing there was a mistake. Even if you find it out, it often takes so much time and effort before you get your money back.
To resolve such costly disadvantages, you may want to consider automating only the bills that have fix amounts and set up an alert every time a bill gets paid from your account. Instead of automating bill payments with banks, some individuals consider automated payment solutions offered by tech companies that specializes in financial solutions. Individuals who prefer to automate their bill payments also often use an international account for a convenient way to transfer funds in multiple currencies.