Reasons to sign up for online bill pay
There are several reasons that may pique your interest in signing up for online bill pay services. These include improving time management, saving money, ecological peace of mind, consolidation of multiple bills, and ensuring a failsafe for emergency situations. There may be other benefits that creditors offer for setting up online bill pay, but I have found these to be the primary gains. Online bill pay is a secure method of paying individual or recurring bills electronically. Most online bill pay services are set up with a checking account, but some services can draft from credit cards.
The ability to set up a recurring payment with an online bill pay service can save time that would normally be spent writing a check, preparing an envelope, and waiting for delivery to the creditor. An online bill pay system will automatically draft a recurring payment at a specified time that is scheduled by the user. For example, if a college loan payment is due on the 10th of each month, the automatic draft can be set to occur on the 10th day of each month. Or, if an earlier payment date is desired (to ensure the payment goes through correctly each month), the payment could be set to draft each 5th day of the month.
Some creditors will offer a financial incentive to collect payment via online bill pay services. The most common example of this is a percentage reduction on the bill’s interest. For example, by signing up for online bill pay with automatic draft, I save 1% each month on my college loans. Not all creditors will offer this service, but it is worth looking into. In some instances, you could be saving money each month. Another service that may offer interest reduction is signing up for Internet-only statements, which save the creditor the cost of shipping the bill to the debtor. The bill is instead sent through e-mail or available on the company’s web site.
Another possible benefit of signing up for online bill pay is the trimming of physical waste. If bills are sent and delivered through the Internet, there is a significant decrease in the amount of paper being produced. Reducing paper consumption results in more trees, which help to maintain a healthy ecosystem on Earth. If our species cuts down on its use of natural resources, our environment will be more enjoyable for us and other plants and animals that share our planet.
Most people have more than one bill to pay on a recurring basis, and it can be difficult to remember when it is time to pay each bill. Signing up for online bill pay can alleviate this problem by consolidating all of your bills together. This makes it easy to reference the due dates for each bill in one convenient location.
Even for people that have a good handle on their time management, things can get in the way of paying bills. The final benefit gained from setting up online bill pay is a failsafe for emergency situations. If a bill is scheduled to be automatically drafted on the 10th of each month, it will happen whether the user makes further action or not. This means that the bill will still be paid even if the user is involved with an emergency, such as hospitalization, scheduling conflicts, or simple forgetfulness! However, this can be a problem if the funds are not available in the drafting account, resulting in an overdraft. Some banks charge hefty overdraft fees, so it is wise to ensure that the money will be available each month before signing up for online bill pay, if it is to be used on a recurring basis.
These are the main reasons to sign up for online bill pay services, although there may be additional benefits that a creditor may offer. Although this is not a viable solution for everyone, most people with a checking account can benefit from signing up for online bill pay.