Every month most households have some kind of recurring bill. For me, those are mortgage, HOA dues, phone/internet, and credit cards. Add rent, power, water, TV, and insurance and you have a standard list of monthly bills in this country. Some people's are more, some are less. How you pay them, however, is usually up to you.
Checks are traditional and comfortable. Just like our grandparents we used to, we can write a check and mail it in . People have been doing this for a long time, so it feels safe for a lot of people. You also get the “float time” for the day or so it is in the mail, but I would not count on that for avoiding overdraft fees.
Checks are slow. Checks have to be mailed and processed before your account is credited. Many companies will give you a couple of days for this, but many will charge you a late fee if you put the check in the mail the day your bill is due. Also, checks are more expensive. You have to buy check blanks and pay for a stamp and envelope to mail your payment.
Online payments are generally free and fast. If you pay on a weekday your payment will generally be credited the same or next day. It is less expensive for a company to process an online payment, so they usually make it easy and do not charge any fees, but some companies are now charging fees for using a credit card rather than an ACH payment. Online payments (and paperless billing) prevent identity theft because there are less papers with your information on it floating around the postal system. You are also helping the environment by using less paper and not having to physically move the payments.
While online payments prevent identity theft, you still have to be careful online. Do not make payments using a public computer (like at a school or a library). Also, make sure the web address starts with https rather than just http. The s stands for secure and identifies the site as using SSL, a secure online transmission language. Also be aware of phishing scams, which are when a scammer poses as the company with a fake email or website.
What I Do
I pay every single bill online. My first goal is to pay whatever I can with a credit card to get travel perks. Whatever I can't pay with a card, I pay using my bank's online bill pay system.
How do you pay your bills? Please share in the comments.
Originally posted February 23, 2009. Updated April 12, 2013. Image by CarbonNYC / flickr.
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