by Rhonda Gail Tremaine

Created on: July 24, 2008   Last Updated: January 08, 2009

Does the Internet scare you? Do you dread the thought of putting personal information on the World Wide Web? Relax! Security today is excellent and paying bills online is actually quite easy. If you can use a keyboard and a mouse, you can set up a bill pay system to suit your needs. Further, the amount saved on stamps can make the endeavor worthwhile. If for example you use ten stamps per month, and you no longer have to buy postage, that is a savings of about $50 per year.

When it comes to bill paying online, timing is important, but it is less critical than when using snail mail. Each and every time you mail a payment, you are relying on the U.S. Postal Service to deliver the important check on time. Late fees can be substantial for even one breach, and it can even hurt your credit score. Therefore, scheduling a payment online can help to protect your credit rating as well as to save you time and money.

Even if you have not made the transition to online bill pay, you can simply pay a credit card bill to get your feet wet. Just visit your credit card bank's web site, create an account if you do not have one, and find the area that says something along the lines of Pay My Bill. Clicking on the icon should take you to a place where you can not only schedule a payment, but decide when the transfer will be made. Suppose your payment is due on the 24th and you schedule it for the 23rd. You may do the scheduling on the 19th but the money will not leave your bank account until the 23rd. Now, compare this with the traditional way. Using the same example, you would have had to mail the check on the 16th when you would need the funds an entire week earlier. Why not pay all your bills electronically? Many banks offer free online banking with a checking or savings account. All you have to do is call or visit and a bank representative will set it up. You will then receive instructions and a password to protect your account.

How does it work? Generally, you will log in and go to a Bill Pay section. Then, sit down in front of your computer with a stack of bills. Systemically enter the information of the bill to be paid such as the name of the company, account number, and mailing address. The bank usually needs a few days mailing time, but many companies can be paid electronically overnight. If during scheduling, a message appears saying that the bill will not be paid on your chosen day, they may need more lead time. Clearly, while online banking is quicker than snail mail, it is not a panacea. You need to leave enough processing time for the bills to get paid.

If you do find yourself crunched for time, there are several remedies. For example, GEICO has an 800 number where you can pay by check over the telephone and your account will be credited right away. If it is a Macys or Sears charge for example, go to the store. They will accept the payment the day it is due. While these emergencies can crop up, it is good to get into the habit of paying bills early and on a regular schedule. For example, go through your mail every Friday, and schedule what bills turn up. Using online banking regularly actually gives you more wiggle room if you are waiting for a check. If your pay check is automatically deposited to your account on the 15th and the 30th for example, you can schedule your bills appropriately for those days. You may also want to set up something for reoccurring bills so that they are automatically paid on a certain day. What could be easier? Once you have made the change, the bill paying days you once dreaded will be a thing of the past!

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