Which bills shouldn’t be set up for automatic bill pay?

It is convenient to have your bills paid each month automatically.  You don’t have to worry about them being paid on time, writing a check or using online banking to pay.  However, bills that can vary each month and have potential billing errors are not good candidates for automatic bill pay. Those are the ones you should review each month before paying.  Some examples are your cable bill, credit card bills, health club bills, insurance bills, and mobile phone and utility bills.

Cable – You need to be aware of possible changes to your cable bill. The special deal you had may have expired, fees increased without you being aware, or you ordered many movies on demand.

Credit card – Credit card bills vary every month. You need to check carefully for charges you did not make. Make sure you have enough to pay the bill each month or you pay overdraft fees to your bank. If you don’t have overdraft protection, you pay bounced check fees to both your bank and the credit card company.  This is not a bill to ever pay automatically.

Health club – Health club memberships have had a reputation of being very difficult to cancel and usually require automatic bill pay.  The terms are not what you thought, special offer expired without your knowledge or you moved, and there isn’t a club nearby. Let’s not forget the high pressure sales tactics.  It is best to find a club that lets you pay monthly or as you use it and not with automatic bill pay.

Insurance – It is best to review your bill carefully before you pay it.  There can be notices about changes to your rate, which you weren’t aware of.

Mobile phone – This bill can vary depending upon the plan you have.  If you pay for texting, minutes, data, and downloads your bill can get expense.  In addition, you could have surprises such as calls to foreign countries or unsuspected charges from scams.  You need to check the bill immediately.

Utilities – Utilities can vary drastically based upon the season.  You need to review the bills the minute they arrive, to make sure the bills are correct. Your electric bill can be too high because the air conditioner was set at too low a temperature or the refrigerator door was left open in your garage or basement. Your gas bill can be high because the temperature was set too high on the furnace. Your water usage could be extremely high, because there is water leak.  The sooner you can correct the problem; the sooner you can lower your bills.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Auto Loans, Credit Cards, Credit Report, Debt, Insurance, Money & Identity

This post was written by John Ulzheimer