Using Automatic Bill Payments for Your Car Payments

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Originally published on October 23, 2017

Article QuickTakes:

• Benefits of automatic bill pay
• Potential pitfalls

As with most recurring payments, using automatic bill pay to take care of your monthly car payments can make things convenient and simple. Think about it. All it takes is the one-time task of setting up automatic bill payments for the correct amount and date through your bank, or having the lender take it out of your bank electronically every month. But is it a good idea for everyone? Here’s a look at the benefits and potential pitfalls of automatic bill pay.

AUTOMATIC BILL PAY CAN SAVE YOU TIME

Not only is it convenient, but it also can give you peace of mind that your bill is getting paid, all without you having to lift a finger. Once your automatic bill pay is established, your bank or lender will handle the rest. Plus, it can give you a few extra moments of free time since there’s no need for stamps or pesky trips to the mailbox.

THERE’S NO RISK OF FORGETTING YOUR PAYMENT

Automatic bill pay ensures that your bills are always paid on time each and every month. A history of on-time payments may improve your credit score. Conversely, late and/or missing payments could really hurt your score. With automatic bill payments, there’s nothing left to chance. Whether you’re swamped with a big deadline for work or you’re off on vacation, there’s no risk of you forgetting to pay on time.

Secure payments can give you peace of mind

With automatic bill pay, you’re usually paying from secured sites designed for this type of activity and with the appropriate security to give you peace of mind. Take the time to understand the website’s security before enrolling in automatic bill pay.

BE AWARE OF THESE POTENTIAL PITFALLS

While automatic payments have their benefits, it may not be for everyone.

• Some companies may charge a fee to utilize automatic bill pay. Be sure to do your research so you are aware of any fees that may be associated with setting up automatic bill pay.
• Also remember not to lose track of how much you’re paying and what day of the month the payment is coming out of your account. The last thing you want to do is not have enough money at the time of the automatic payment and then get assessed an overdraft fee. You can avoid this by keeping a record of your withdrawal dates and amounts on a calendar.
  

Using automatic bill pay could provide convenience and give you peace of mind without the hassle of remembering to pay your monthly bill. Just be sure to keep track of the dates and the amounts paid in order to stay on top of your finances.