Yahoo Finance 5 Reasons to Set Up Auto-Pay for Your Bills Now
If you’re still paying your bills the old-fashioned way every month, here’s why it’s time to make a change and set up auto-pay.
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We all have bills to pay, and there are more ways than ever to pay them. Not all payment methods are created equal, though.
If you’re logging in online to pay your bills every month, sending checks in the mail, or you’re one of those people who still goes to the service provider’s local office to pay, then there are several potential benefits of setting up auto-pay.
1. No more missed payments
Let’s start with the most obvious -- once you set up auto-pay on your bills, your payment will always be submitted on time, provided there aren’t any issues with the payment method you have on file. As long as your credit card has enough available credit or your bank account has the funds, you’ll be good to go.
That means you won’t have to worry about:
Late fees costing you more money.
Interruptions of service because you forgot to pay on time.
Damage to your credit score due to a spotty payment history.
2. It’s faster and more convenient
Paying bills isn’t exactly something that takes up a huge chunk of your time, but you will probably spend about five to 10 minutes on it per bill. Now add that up over your home, cell phone, utilities, auto insurance, and all the other bills you have, and you can see how bill payments could easily eat up an hour or more of your time every month.
Once you set up auto-pay, it frees up all that time you used to spend on your bills. It means you don’t have to keep track of payment due dates anymore, either.
3. You reduce your risk of identity theft
No one wants to be the victim of identity theft. Even though you can’t completely eliminate your risk of it, you can make yourself safer by opting for auto-pay over paying your bills by mail.
When you pay your bills by mail, you’re receiving a statement from the provider every month. That statement will have some of your information on it, such as your name, address, and account number.
Your payment will have either your credit card number or, in the case of a check, your bank account number on it. Either way, it could be dangerous should your payment get lost or stolen, because someone else would have your sensitive financial information.
4. It might save you money
Companies like when consumers use auto-pay, because it means they’re more likely to get paid on-time.
That’s why some companies will offer you a discount if you set up auto-pay with them. It won’t be for a huge amount, usually around $5, but considering it doesn’t require any work on your part, it’s a simple way to save some cash every month.
5. You can earn more credit card rewards
If you were previously paying your bills by check or through an ACH transfer from your bank account, then setting up auto-pay with a credit card is a great way to earn more rewards, whether that’s with cash-back cards or travel rewards cards.
What makes this even better is that many of the best credit cards have bonus categories where you get more back. For example, there are certain cards that earn more on payments to cell phone and internet service providers and others that earn more on utilities payments. Matching your card to the bill you’re paying will allow you to maximize your rewards.
Making bill payments easier
Considering the ways you’ll benefit from setting up auto-pay on your bills, it’s clearly the most sensible option. You’ll never need to remember another due date to have your payments sent in on time. Your personal information won’t be getting sent through the mail. You’ll have one less task to handle each month, and you may even get some money back through an auto-pay discount and credit card rewards.
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