Paying bills is a very dull and time-consuming process, but now there are things that can make the process snappier and easier automatic payments. The most unique and quick thing is setting up automated payments, and making your recurring payments an automatic payment can make the bill paying process facile and straightforward. Ultimately you can focus on managing other essential things in your life rather than financial life. If you’re not availing of the automatic bill payments these days, then you may be thinking about what all the rubbish is about. Anyways, no worries, we will explain what automatic payments are in this article. Moreover, you will also learn about the whole process of automatic payments and the pros and cons of applying this method to your financial life. Without any obstruction, let’s quickly understand what automatic payment is?
Automatic paymentsAn automated payment essentially sounds the same as it works. In simple words, automatic payment is the type of payment that is impulsively sent to one of your billers from your credit card or bank account. Moreover, you can easily permit automatic bill payments by using your current checking account, saving account, or any money market account. Furthermore, you can also utilize your debit and credit card for this purpose. According to the payment plan, the amount that is due for the payment is collected headily by the biller. Types of bills paid via automatic payment The good thing about automatic payments is that you can pay several sorts of bills. For instance, by using automatic bill payments, you can pay for
- Student loan payment
- Auto loan payments
- Cell phone bills
- Credit card bills
- Streaming subscriptions.
- Utility bills
How does automatic payment work?There are one of two ways upon which automated payments can be processed. This process depends on you, which way you choose for yourself. The first way is very snappier and more straightforward: automated payments via ACH transactions. ACH is the abbreviated form of automated cleaning houses for your further information. The automatic cleaning house refers to EFT or electronic funds transfer to or from a bank account. Automatic payments by using credits union’s online payment system If you set up automatic bill payments by using your credit union’s online payment system or bank account, in this case, your biller will get payment via automatic cleaning house transfer. Moreover, in this process, you only need to tell your bank or credit union how much to pay and when to pay it every month. After that, the bank will approve that payment withdrawn from the selected account. Moreover, the amount will be transferred to the company you need to pay each month. This is the entire procedure of the first way. Automatic bill payment by using credit card Now move towards the second way. That way is to simply set up automated bill payments by using your credit cards. For example, if you are a Hulu or Netflix user and have to pay your Hulu or Netflix subscription each month, you could set up an automatic bill payment by permitting those fees to be charged from your credit card.
Read More: Use of advanced technology for struggling students in classrooms
Ways to set up automatic bill paymentGenerally, there are three ways to set up an automatic bill payment. These setup methods for automatic bill payment depend on which biller you want to pay. The user of automatic bill payment can schedule automated payments via your
- Banks’ online bill payment
- By using a credit card
- Direct from the biller
Automatic payment in actionHere is a practical example if you are still confused about how automatic payments for bills work. This example will surely clear all of your queries related to automatic payment in action. Let’s suppose you have a student loan, and your student loan servicer gives an interest rate every time you set up an automatic bill payment. This payment method ultimately gets your loan paid off as quickly as possible. Here is a thing you should know about the automatic payment, it will save money of interest when you decide to sign up. For following the procedure, firstly, you have to log in to your student loan account via your loan servicer’s website. Now, from there, you would cruise to your payment options list. After that, click on the automatic payments. Directly you plug in your payment information. For instance, if you choose a bank account for payment, then you have to provide your servicer with your bank account number and bank’s routing number. After that, the payment will be deducted every month from your selected bank account at the due date. Your loan servicer has set that due date. The best thing is you will get a discount on your interest rate.
- The process of setting automated payment via your credit card or bank account is snappier and easier.
- The automatic bill payment saves your time and protects you from the boring manual procedure of paying bills.
- The best thing about this payment is. Instead, it saves your time. Meanwhile, it also saves your money.
- Automatic payments save you from costly late fees and penalties
- The payment method helps to manage your budget easily.
- Automatic bill payment is not acceptable by every biller
- You may face the problem of over-drafting if you are not keeping an eye on your balance.
0 thoughts on “Automatic payments”