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Charlington
Posts: 21
Registered: ‎10-26-2009
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Correlation Between Automatic Bill Payment and Disposable Income

Is there a correlation between setting up automatic bill payments and disposable income?. I have always found it very hard to set up automatic bill payments. I try and try, but I always fail. I would rather wait until the money is in my checking account before I start paying the bills. Every time I have tried to set up automatic payments, it works out fine for a few months then I end up getting dinged for one or two overdraft fees. At which point, I promptly cancel the automatic payments. My income and bills fluctuate wildly from month to month. I just think for some people, like me, in the lower income bracket, it's almost impossible to successfully set up automatic bill payment and keep up with it without being dinged by overdraft fees at some point. There is just not enough disposable income left over to protect us incase a bill sails through unexpectedly.
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Uborrow-Upay
Posts: 2,708
Registered: ‎10-16-2008
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Re: Correlation Between Automatic Bill Payment and Disposable Income

[ Edited ]

I don't trust automatic payments, period.  I'm like you...I feel more comfortable making payments knowing that the money is in the account, and I'm controlling it, not some computer program. 

 

I've had glitches here and there with monies being debited in error by the bank, and had the automatic payments been in place, I would've had one hell of a mess.  A returned payment to a creditor (a credit card company, for instance) can jack your rate to the default rate.  The CCC won't care that your $14.95 check to somebody else was processed by your bank as $1495.00, they just know that your payment (made to them on the due date, automatically) bounced.  Nobody needs that.

 

I don't know if disposable income has anything to do with it.  You work with what you've got, whatever it is.  But it'd be nice to have an account you could draw on that had enough cash in it that you could set up automatic payments from it forever, without having to look at the balance.

 

When you get to that point, give me a shout...I'll be your new best friend!  :smileyhappy:  

 

 

 

 

 Edit to add:  BTW, I've always thought that the automatic payments thing was just another ploy by the banks to complicate our lives, not to make life easier like they advertise.  The more things you don't have to remember to do, the more things you will forget to do.  The banks' reward comes from the overdraft fees, the bounced payment ratejacks and late fees, or both.  And they've got the perfect excuse for when it happens to you, because you set this stuff up yourself, so of course, it's entirely your fault, right?

 

Be very careful when banks try to "help" you in your life.  They're almost as bad as the government.

Message Edited by Uborrow-Upay on 10-30-2009 06:52 AM
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haulingthescoreup
Posts: 28,098
Registered: ‎04-01-2007
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Re: Correlation Between Automatic Bill Payment and Disposable Income

It's not so much a correlation between the drafts and disposable income, but the ability to always have that amount of money on hand.

One possibility would be to set up two accounts, either both checking, or one checking and one savings, if you can do bill pay from savings. Pay your paychecks/ income into one checking account. Then figure out what your expected drafts would be per month, and always have that amount plus $100 in the second account from which you will draft. Keep that second account at the required amount, and let the first fluctuate.

But if you're not noticing when your checking balance is too low for a planned draft, you might need to back up first and get some better record-keeping going. I'm one of the few dinosaurs still treading this earth who keeps an old-fashioned check register. I only write 4 or 5 checks a year, but I record all my debit card use, ATM w/d's, online orders, and online bill pays in the register. I confirm it daily (yes, daily) with my online bank account.

And I never, ever believe what the phone or ATM machine says my balance is. :smileywink:
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Credit-Wise
Posts: 240
Registered: ‎08-08-2009
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Re: Correlation Between Automatic Bill Payment and Disposable Income

you may also call your creditor or seervice companies to change some of your billing dates so that this might be more in line with when you are paid.  so that the cashe will be in you account by then.
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charliebrown1370
Posts: 313
Registered: ‎06-26-2009
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Re: Correlation Between Automatic Bill Payment and Disposable Income


haulingthescoreup wrote:
I'm one of the few dinosaurs still treading this earth who keeps an old-fashioned check register. I only write 4 or 5 checks a year, but I record all my debit card use, ATM w/d's, online orders, and online bill pays in the register. I confirm it daily (yes, daily) with my online bank account.

And I never, ever believe what the phone or ATM machine says my balance is. :smileywink:

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beamMEup
Posts: 4,470
Registered: ‎12-31-2008
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Re: Correlation Between Automatic Bill Payment and Disposable Income

We've been burned by automatic bill payments drawing from checking accounts - and have spent months getting it straightened out.  At this point, the only automatic bill payments I'm willing to set up are on my cc's. 

 

Unlike using my checking account, if there's an error on my cc, I have time to get it straightened out--and there is no possibility of overdraft fees.  No possibility of overlimit fees, either, as my bills never come close to maxing out the cc.

 

Maybe some other posters have had this work for them.

 

I don't do any automatic payments to my CC's from my checking account - those I do the good old fashioned way (but I do them twice a month).  And, unfortunately, like Hauling, I'm checking that bank account daily.

 

 

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Jolla
Posts: 8
Registered: ‎05-16-2007
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Re: Correlation Between Automatic Bill Payment and Disposable Income

You may want to consider an online financial tracking program like Quicken Online or mint.com (both free). The programs don't pay your bills for you, but you can track when bills are due, what your balances are, etc all in one place.
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laz98
Posts: 4,336
Registered: ‎09-06-2008
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Re: Correlation Between Automatic Bill Payment and Disposable Income

i don't trust automatic bill pay.  i want to pay my bills on my schedule :smileywink:
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Kay_Cee
Posts: 201
Registered: ‎01-16-2008
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Re: Correlation Between Automatic Bill Payment and Disposable Income

haulingthescoreup wrote:
I'm one of the few dinosaurs still treading this earth who keeps an old-fashioned check register. I only write 4 or 5 checks a year, but I record all my debit card use, ATM w/d's, online orders, and online bill pays in the register. I confirm it daily (yes, daily) with my online bank account.

And I never, ever believe what the phone or ATM machine says my balance is. :smileywink:

 

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haulingthescoreup
Posts: 28,098
Registered: ‎04-01-2007
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Re: Correlation Between Automatic Bill Payment and Disposable Income

I did finally get around to setting up automatic minimum payments on my CC due dates, but from their sites, rather than from my bank site.

I doubt that they'll ever be used, as I PIF before the statement, making the minimum always $0, but if I get hit by a bus or something, I'd like my family to have time to figure out my finances without everything going late in the interim.

I agree with the others about automatic payments from your bank. If something goes wrong, you have two entities to deal with --your bank (did they do their job and send it when scheduled?) and the lender (did they do their job and credit your account properly?) I pay from the lender's/ CCC's site, and I copy/ paste the confirmation onto a sticky (Mac) or Notepad (Windows) and leave it on my laptop until I see the credit on the next online statement. So far, so good.
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