Automate Your Card Payments, Simplify Your Life!

Given the hectic pace of life, we sometimes get caught up in the moment and forget to accomplish important tasks on our to-do lists. There are certain errands that you can probably postpone for week or two without incurring too many problems. However, there are others for which even a one-day delay can prove to be disastrous. For example, while you can easily put off your plan for buying a new television until next month, the same can't be said when it comes to making credit card payments.

A late payment on a credit card can not only result in a sizable late fee; it can also cause a hike in your interest rate. In addition, if you're more than 30 days late, the blemish is likely to appear on your credit report and may damage your score.

So what can you do to avoid such a situation? One option is to resort to automatic bill payments. Most credit card issuers offer the facility to sign up online and authorize the card company to deduct the payment from your bank account on a predetermined date each month. By choosing one of the three options listed below, you can save both time and effort.

1. For those who are concerned that they might forget to pay their bill, one option is to allow the card company to deduct the minimum amount due every month. However, there is a drawback - if you neglect to follow it up with regular additional payments, you may rack up thousands of dollars in credit card debt.
2. It's best to allow the issuer to automatically deduct the full balance due, especially if you use your card on a regular basis to accrue rewards. If you choose this route, you must make sure that your account always has enough funds, else you may end up paying lofty overdraft charges and return payment fees.
3. Another option is to authorize a recurring payment of a fixed amount that's greater than your minimum payment. This can be useful if you have incurred a large amount of debt on a particular card, but have stopped making further purchases and are trying to pay down the accrued balance.

Choosing autopay for your credit card bills can simplify your life and take a load off your mind. While so doing, ensure that you implement the following tips.

To avoid nasty surprises, make sure that you read the fine print carefully and understand all the terms and conditions that come with this facility. Select the day on which your payment is to be deducted according to your income and spending pattern. For example, it may be a good idea to change your due date to coincide with the time that you receive your pay check.

Many consumers tend to get complacent and forget about managing their account once they set up automatic payment. This can prove to be dangerous. It is important to keep tabs on your finances to ensure that no criminal can get away with any wrongdoing. Always remember to combine autopay facility with alerts – ask your issuer to send you a notification when any charge above a pre-specified amount is made to your account. This way you can identify fraudulent transactions and take immediate steps to address them before the automatic payment goes through. Additionally make sure that you examine your statement each month before the due date to identify any suspicious activity.

You should also be aware of what happens if you make a manual payment before the due date. In most cases, if you pay your minimum due (or a greater amount) before the automatic processing date, then autopay does not go through. However, you should always confirm this with your bank in order to avoid paying twice.

By using the autopay facility to pay your credit card bills, you can not only lessen your responsibilities, but also free up time to accomplish other important tasks.

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