using online bill pay

I haven’t  written a check in over five years. 

I’ve been liberated from the pain of stamps, worries about mail delays and frequent trips to the post office. 

I’ve also been amazed at the convenience and efficency of a service that costs me less than seven dollars a month, and saves me a few hours of pointless work.

All of this convenience comes from one source; online bill pay.

THE BENEFITS

In addition to saving time processing paper statements and mailing off checks, there are several other important benefits of online bill pay.

1. Increased security.  The majority of identity theft still occurs when papers containing account numbers, check routing numbers and other personal information gets into the wrong hands.  With online bill pay, the majority of payments are processed electronically, with no paper trail whatsoever.
2. Guaranteed on-time payments.  All my transactions come with either a 2 day (for electronic transactions) or 5 day guarantee.  That means my bank is responsible for any late fees that could arise if the payee doesn’t get the money in time.
3. Easier budgeting.  In addtion to being able to schedule payements to coincide perfectly with my direct deposits from work, my online bill pay service also offers numerous reports I can run to monitor my spending and keep track of transactions.  This makes creating a high level budget using data from prior months a snap.
4. Investigators to research problems.  In the entire time I’ve used online bill pay, I’ve only had three problems with payments.  In every case, I sent a request (via the website) for research.  Someone from my bank was then assigned the case and was responsible for contacting the payee and insuring the payment was received.  This saved me the headache of calling these companies, waiting on hold, etc.  Within 48 hours of raising my inquiries, I received a response, and in all 3 cases the payee realized it was their error, and promptly credited my account.

HOW TO

There are a variety of different ways to use online bill pay, from individually paying each company using their own website, to using a dedicated bill pay company online (Paytrust, Checkfree and Yahoo Bill Pay to name only three) and finally setting up bill pay with your own bank or credit union.

In my opinion, it’s easiest to do online bill pay with your own bank.  They already know your account information, etc and they’re obviously a company you trust.  I’ve been using online bill pay with my bank from the start, and have no complaints whatsoever.

Getting started is easy and typically involves:

1. Creating an online account via your bank’s website.
2. Setting up a list of payees.  This process is simplified tremendously by a typically LONG list of preset payees that they already have the information (i.e. address, etc) for.  Companies that appear as pre-existing payees will include utilities, car financing companies, cellular phone companies and many, many more.  If your payee isn’t already set up, creating a new payee is simple.  You’ll need to have a copy of all your monthly statements on hand to input your account number and any other information they may request.
3. Scheduling payments.  You can typically schedule payments automatically on the same date every month, or set up a manual payment each time.  I prefer the latter as it allows me more flexibility in aligning payments with my direct deposits.

With few exceptions, that’s it. 

You’re well on your way to the convenience and security of paperless banking.  One final note; you can use bill pay for ANYTHING.  I use it to pay personal debts and have even used it to pay my rent in the past as well.  The possibilities are endless. 

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