MIND YOUR BIZNESS
The Cost of Complacency: How Autopay can Drain your Dollars
Article by TheZebra.com on BPT
(BPT) - When it comes to managing your monthly bills, it doesn't get much more convenient than autopay. Because this option eliminates missed payments and late fees, it's easy to see why three-quarters of Americans have opted in, with anywhere between one and seven monthly payments, according to recent survey findings. However, consumers are also discovering that enlisting in autopay isn't without its financial downsides. The following survey findings from TheZebra.com (an insurance comparison site) show how auto-pay can make consumers complacent.
* Nearly a quarter of people (23%) admit to not paying attention to what's coming out of their bank accounts. If the result is an overdrawn account or a billing error slipping through, that can prove to be a costly mistake.
* One-third (29%) of respondents confess to forgetting to cancel services linked to autopay after they've stopped using the services. A couple prime examples of this are a music streaming service subscription or a gym membership.
* Nearly half of consumers indicate that
once autopay is set up for their car insurance payments, they never get around to re-evaluating their fees. Considering the market value of our cars depreciates every year, this suggests that many consumers are missing an opportunity to get the best coverage at the best price, as car insurance rates can change daily.
* Finally, by not taking time to evaluate costs or cancel unused services, consumers are paying the price. Some 29% of respondents estimate they're losing $100 annually, but for high-ticket items like a gym membership, the savings could be in the thousands.
Now that you know the high price you may be paying for the convenience of autopay, here are some tips to help you stay in control of your finances.
1. Keep track of your statements. Because money is withdrawn from your account each month, it's easy to lose track of your spending. Otherwise, if a price hike takes effect or if you end up consuming more services than expected, the consequence can be a higher-than-expected bill. If your bank account lacks the funds to cover it, you'll end up with an overdraft,