Five Bills You Should Never Put on Autopay
When discussing bill pay services, I frequently come across people using autopay for nearly everything. The convenience of autopay is undeniable—it has become an efficient tool for managing recurring expenses effortlessly, a tool I often use for both personal and client bills. However, it's important to recognize that not all bills are equal and autopay can make it difficult to track spending.
While setting and forgetting payments may seem enticing, certain bills may demand a closer look before giving up control to autopay.
As a professional daily money manager, here are five types of bills that I prefer to keep off of autopay:
Medical Bills
Medical bills are known for their intricate codes and charges, making them prone to errors. Automating payments without prior review may lead to overcharges or billing inaccuracies. Taking the time to manually review medical bills allows you to ensure accurate insurance processing, identify any discrepancies in charges, and address them with your healthcare provider or insurance carrier through dispute resolution.
Real Life Example: A client received a medical bill for an ambulance trip for $970. After reviewing the bill, we realized the provider did not submit the charges to the insurance carrier.
New Subscription Services
Specifically, subscriptions after the trial period where you're still deciding whether or not to commit fully. It's tempting to let autopay take over as you move from trial to full subscription, but this could lead to charges for services you no longer find valuable. The abundance of subscription-based offerings for streaming, software, and entertainment makes it easy to overlook these recurring expenses. By manually reviewing your subscription bills, you can pinpoint any redundant or forgotten subscriptions and proactively cancel them.
Real Life Example: After the 12-month promotional pricing of $29.99 a month for our internet, the price jumped to $74.99 a month. We received no additional benefits for the increased price, only a higher cost while the company still offered new customers the promotional price.
Country Club Membership Fees
While monthly club membership fees are transparent, they often pale in comparison to the spending incurred within the club—a factor that can give rise to unforeseen bills. Simple errors, such as transposing digits in member numbers, can culminate in erroneous charges. Opting out of autopay for club memberships allows for a review of each charge, ensuring accuracy and preventing unwarranted expenses.
Real Life Example: A colleague’s first month’s bill after joining a country club was $2,500 higher than expected because another member with a similar club number wrote the wrong number down for an event they sponsored.
Variable Utility Bills
Utility bills such as electricity, water, and gas can fluctuate from month to month based on usage. While autopay offers convenience, it may not account for unexpected spikes in consumption or billing errors. Manually reviewing your utility bills allows you to detect anomalies and adjust your usage habits accordingly, potentially saving you money in the long run. On an important note, unexplained spikes in utility bills may signal underlying issues within your property, such as a water or gas leak, which may go unnoticed if bills are on autopay.
Real Life Example: A family friend received a surprise $14,000 water bill because a watermain broke at their lake house and was flowing into the lake. They were paying to fill up the lake!
Credit Card Bills
While autopay can ensure timely credit card payments to avoid late fees and interest charges, it may also lead to oversights in monitoring your spending. By manually reviewing your credit card statements before making payments, you can identify fraudulent charges, track expenses, and maintain better control over your finances. However, it is important to make sure to pay your credit card balances on time and in full each month to avoid accumulating interest.
Real Life Example: A client had canceled a car wash membership, but the company kept charging her the monthly fee. We caught the error when reviewing the credit card transactions.
While autopay is convenient, it eliminates the opportunity for pre-payment bill review which potentially could lead to errors, oversights, or overdraft fees. Furthermore, negotiating with vendors before funds leave your account is notably simpler than getting a refund approved after overpaying. Striking a balance between the convenience of autopay and the necessity for manual oversight is the key to effective daily money management.
If you're seeking the ultimate shortcut for hassle-free bill management, consider the services of a daily money manager.
Our expertise enables us to optimize autopay for suitable bills, manually review and pay variable bills, and diligently monitor monthly transactions for billing discrepancies, irregular spending patterns, and potentially fraudulent activity. Book a complimentary introduction with us to see if a daily money manager could help you streamline your personal finances.
This article is for general information purposes only. It is not intended to offer legal or investment advice.
Further Reading
Yahoo Finance Bills to Never Autopay
