4 Monthly Bills We Never Put on Autopay
Written by
Heather Taylor
Edited by
Renee Ross
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Some bills benefit from being put on autopay and using the “set it and forget it” payment approach. However, even if you can set a monthly bill on autopay this doesn’t always mean you should do it.
GOBankingRates spoke to three financial professionals about the monthly bills they don’t put on autopay and some of the reasons they don’t advise clients to do so either.
Utilities
Grant Gallagher, AVP and head of financial well-being at Affinity Federal Credit Union, has heard horror stories of occasional massive errors on utility bills. Sometimes these errors can result in thousands of dollars in overbilling. If you have your utility bill set on autopay, this can be disastrous news for your bank account.
Gallagher said variable bills such as utilities aren’t good candidates for autopay. These bills change on a month-to-month basis, especially in the winter months when home heating costs range significantly depending on the weather.
Gym Membership
Did you just start going to a gym? Alonso Rodriguez Segarra, CFP and CEO of Advise Financial, said to reconsider putting a gym membership on autopay.
Aside from being a new member and trying to determine whether the gym is a fit for you and your health journey, Segarra said it can be challenging to get out of payments after you join.
Smartphone
If you’re not on an unlimited plan, Forward Financial CFP Betsy Hutchins said to avoid putting your monthly cell phone bill on autopay.
“Charges can rack up very quickly so it is better to assess it each month,” Hutchins said.
Credit Cards
Credit cards are popular monthly bills to put on autopay, usually done to save some time and effort when managing your finances. However, putting credit cards on autopay means you miss out on an important opportunity to review your monthly charges.
“If you’re not reviewing your bill monthly for any incorrect charges or fraud,” Gallagher said, “then you should consider turning off autopay and checking in on the activity regularly.”
Cardholders who carry balances and pay close to the minimum amount due are ideal candidates for turning off autopay. As your balance starts to grow, Gallagher said, it can increase from a set minimum amount to a percentage of the balance.
If you’re used to making a minimum monthly payment, you could be in for an unwelcome surprise if the payment pulled from your account increases to the balance’s percentage.
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