5 Costly Mistakes People Make When Paying Bills
No one likes paying bills, but chances are that you have at least a few. And, of course, the rules depend on who’s collecting the money. You might have autopay options, or you might be sending in checks using your bank’s bill pay features.
When paying bills, having a good system can make a big difference — especially when it comes to extra fees and double charges. Here are a few mistakes to avoid when paying your bills.
1. Not reading your statement
You’ve got the bill and can just pay it, right? Especially if you’re on autopay. Even if you’re using autopay, you should still review your statement.
Your statement includes information about charges, fees and other information. Look through your statement to ensure you aren’t being charged for services you’re not using. You can also see whether fraudulent charges have been added to your bill.
Check your statement against your own records and verify that the bill is accurate. If you find inaccuracies, contact the issuer as soon as possible. Ask questions about the bill and refer to your records. Write down when you called and who you talked to. You can also contact the issuer in writing if the bill isn’t resolved.
2. Set it and forget it
Autopay can be a great tool to ensure you don’t pay late or miss payments. However, verifying your payments, particularly your first payment, is a good idea when setting up your autopay.
Depending on the company, setting up your autopay account can take several business days. In the meantime, you might be required to make a payment. In some cases, it’s possible not to learn about a missed payment until the next billing cycle.
Find out when the first payment will be made from your account and verify that the company has the right information. Then, double-check to ensure that payment came out of your account as expected. After your autopay is established, regularly check to keep tabs that the amount is being removed on schedule.
3. Assuming a grace period
Some companies offer a grace period for your payment. So, if you’re late, you won’t be charged fees as long as you pay within a couple of days. Not every company offers this, however.
Just because your last landlord didn’t start charging a late fee until the fifth day of the month doesn’t mean that your current landlord will be as forgiving. You might start paying a daily late fee immediately.
Read the fine print in all of your agreements and verify when late fees start accruing. You don’t want to be caught unaware, thinking you have time to rectify a mistake.
This also applies to autopay and bill pay. Consider setting up an automatic plan that allows your payments to be taken out two or three days before the due date. That way, you can catch mistakes ahead of time, and you’re less likely to run out of time.
4. Paying fees you can get out of
Watch out for fees. Those can add up quickly, and some can be easily avoided.
Some of the common fees you can likely avoid include:
- Late fees: Make sure you aren’t paying late. Schedule automatic payments at least a few days ahead of the due date. Know your due dates and verify that your payments are being made on time.
- Convenience fees: Check to see how to avoid convenience fees, which can be costly. Some companies charge higher fees for credit card payments, for instance. You might be able to avoid these by using your bank account, debit card or setting up bill pay through your bank.
- Paper statement fees: If you’re receiving paper statements, there might be a charge. Check to see if you’re being charged for receiving mailed statements. Avoid this fee by switching to digital statements.
- Other waivable fees: Find out if other fees can be waived. You might be surprised to discover that your bank will waive certain fees associated with bills if you maintain a minimum balance or that you can have fees waived by choosing autopay with some companies.
5. Not reviewing the price you’re paying
Finally, don’t forget that you can always shop around for a better rate. Don’t assume that you’re getting the best price. Before you lock into a bill, consider different plans and costs.
Once you have locked into a service, remember to make sure you’re still getting the best deal periodically. For bills like insurance, you might get a better rate by comparing different policies.
You can also look for different service providers for your cell phone and internet. See if you can find a better deal, and let your current provider know you might cancel. They might match their competitor’s price. And, if they don’t, you can switch and save money.
Take the time to review your bills, evaluate whether you could save money and act accordingly.
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