Smart loans and wise investments comprise the strategy of a sound personal financial manager, yet it is the day to day execution of these strategies that gets too many people in trouble. What they need are the right tactics to manage and schedule each payment. Ideally, a payment system will allow you to specify exactly who gets paid and when, leaving your money in your bank account until the last possible moment. For years, such a system was either impossible or cost prohibitive. Yet today, nearly anyone can do it with electronic payments through their bank.
Getting Started with Electronic Money Payments and Bill Pay
For those who have been writing checks for their entire life, the idea of switching to electronic payments can be daunting. But the benefits of doing so are so great. It is worth your investment of time and effort. First, you must log on to your bank’s web site and learn how the system works. Most will offer some form of online tutorial. In the absence of such a system, you can simply contact your bank over the phone, or even visit them, in order to have someone walk you through the process. Once you learn the basics, it is time to get started.
Go through your monthly bills and enter each biller’s address along with your account number. Be sure to schedule repeating entries for fixed monthly payments such as rent, mortgage, and of course, investment savings. This process will take a little extra time at first, but it will pay off every future month with significant savings of the time you had spent writing and mailing checks. Of course, you will also save money on stamps as well.
Each month, when your bills arrive, simply log in to your account, enter the payment amount and due date, and submit the payment. With most systems, the money will remain in your account until the due date, and your payment will be guaranteed to arrive on time. This system even works for personal payments, as your bank will simply mail a check to any person or company that it cannot pay electronically.
Bill Pay Problems to Avoid
While electronic bill payment is incredibly convenient and accurate, no system is perfect. In fact, most of the problems that you will encounter will be of your own origin. For example, be extremely careful to enter in the correct account number and address for each biller. Each month, double check the payment amount and date to ensure you haven’t transposed any numbers by mistake. If you have multiple accounts with the same biller, be extra cautious not to pay the wrong account. When scheduling payment, always choose the first business day before the due date, just be certain your payments are properly credited.
Even though your payments are guaranteed to be received on time, it can happen that a company will credit the payment as late. When this occurs, contact your bank and ask them to investigate. In most cases, your bank will reimburse you for any late fees incurred as a result of their errors. Electronic payments are an amazingly fast and easy way to pay your bills. By taking time to learn the system, and by carefully inputting each payment, you can reduce the time and effort needed to manage your finances.
Jason D. Steele is personal finance writer and a consumer advocate.He specializes in helping people eliminate credit card debt and maximize rewards. His work can be found at personal finance sites like Money Crashers, Ask Mr Credit Card, and at his home page.
Photo by Chris Harrison via Flickr