NEW YORK (MainStreet)For many of us, paying bills automatically is a decision we make, because it is easier than managing our money manually. But is it good for your bottom line? Below we are going to look at which people automatic bill pay is right for, and which folks might be better off taking the hard road to bill paying.
We will talk with a few experts and look at who might want to use automatic bill paying, who will want to steer clear and why automated bill paying is not free pass to stop paying attention to your finances completely.
Who Should Auto-Pay?
Choosing to auto-pay your bills has a lot to do with who you are and how your money comes to you. If you are a salary worker who can predict to the day how much money is going into your account then automatic bill pay may be good for you.
Of course, that is not the case for every worker. Many of us live on variable incomes and have to weigh the benefits and detriments of the technological convenience.
"People choose automatic bill pay as a way to spend less time when it comes to paying the bills," said Deacon Hayes, the founder of Well Kept Wallet, LLC. "Unfortunately for some, it can be a costly mistake. For instance, if someone is commission only, their income is variable. This means that they cannot count on the money being in their bank account to pay their bills automatically since their income fluctuates every month."
In addition, people who work in jobs where a significant portion of the earnings come from tips can have challenges when it comes to automatic bill pay, Hayes says. People like servers, bartenders, pizza delivery drivers have fluctuating incomes and can find it difficult to predict how much money they will have in the account on any given day.