Forgetting to pay your Credit Card bill on time has negative consequences. Avoid it by setting up automatic payments for your bills. Learn more.
Are you one among those who usually end up forgetting to pay their monthly bills, especially Credit Card bill? Although forgetting to pay your Credit Card bill within the due date may not seem like a big deal, it leads to late payment fees, higher-interest rate as penalty and can negatively affect your Credit Score. So, if you keep making the mistake of missing your Credit Card bill due date, then the ideal solution for you is to set up automatic payments.
Automatic payments or auto-pay is basically a regular monthly transfer of money directly from your bank account towards settling your monthly bills. It requires a one-time setup wherein you choose a recurring payment amount, which can be your total outstanding or minimum amount due, and a due date.
Automating your Credit Card bill payments is convenient, secure and ensures that you never miss a payment, ever. Srivastava Mukherjee, a 40-year old businessman from Kolkata, said, “My Credit Score was a mess, thanks to all the late payments I made.
That’s when my friend suggested that I sign-up for auto-pay for my Credit Card bill payments. I’ve never missed a payment since and my Credit Score has improved drastically over the last two years. Phew!”
What are the advantages of automatic payments?
One of the biggest advantages of automating your Credit Card payments is the simplicity it adds to your finances. Unlike manually paying your bills within the due date every month, automated payments lets you save a lot of time by automatically deducting the due amount from your account.
At the same time, it ensures that you never have to remember payment due dates and never have to miss a payment either. And not missing payments saves you from future headaches such as paying late payment penalty, high-interest charges and putting your Credit Score at risk.
Any downsides?
Here are the downsides to setting up automatic payment for your Credit Card bills:
Not having enough money in your account – If an automatic payment has to go through, you need to have sufficient money in your account when the bill is due. So, if you don’t usually have enough funds in your account, then it’s best that you don’t automate your bill payments as it would be equivalent to not paying your bills.
Billing errors – If you automate your bill payments, you’re less likely to review your bills before making a payment. This can be a big concern especially if there are duplicate entries or fraudulent transactions in your bill statement. We’d say that you make it a habit to review your bills every month even if you’re automating your payments.
Always remember that there is a downside to almost everything! But, as far as auto-paying bills is concerned, its advantages easily outplay its downsides.
How to set-up automatic payments
Although the process may vary from one card issuer to another, it usually involves logging into your Credit Card account, following the steps required to link your bank account to your Credit Card, and finally setting up auto-pay on a particular date. Simple, isn’t it?
Bottom-line: To auto-pay your Credit Card bills or not, you ask? Auto-pay it, we say!
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Originally published at: https://blog.bankbazaar.com/should-you-set-up-automatic-payment-for-your-credit-card-bills/
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