Setting your expenses on autopay might seem like a good idea at first. You save the hassle of paying bills each month and avoid late fees. Good, right? Think again.
Although some expenses are smart to set on autopay, others require closer scrutiny. You may not notice the higher fees you’re suddenly paying without warning. This doesn’t mean you need to pay all your bills manually, though. Here is a list of bills you should think twice about setting to autopay.
1. Gym Memberships
Prioritizing your health is always smart, but paying for an unused gym membership isn’t. Gym memberships are notorious for having paying customers who rarely show up.
If you want to be healthier and recently started going to the gym, avoid setting auto payments. However, once you’ve proven to yourself that you can commit to going to the gym a few times a week, feel free to enable autopay.
2. Subscription Boxes
Many subscription box services are cheap upfront. However, like gyms, they can eat away at your budget if you rarely use them. Instead, purchase items long enough to know your purchasing patterns.
If you buy shaving supplies every two months, you know a subscription for this timeframe is reasonable. You can save some money by signing up for subscription boxes. However, if you sign up for subscription box services too soon, you may end up with more supplies than you need.
3. Streaming Services
If you’re unsure which shows matter most to you, pay for all your streaming services manually. Odds are that eventually, you may forget to pay for some and lose service. However, you may discover that many of them don’t deliver enough value. Stop paying for multiple subscription services because you might be overpaying annually.
4. Utility Bills
Utility bills are variable in pricing because it depends on how much electricity or gas you consume. Imagine having hundreds of dollars deducted in just one month due to an error or over-usage on your end. This can quickly drain your budget or reinforce bad usage habits.
5. Credit Card Bills
Like utility bills, credit card payments will vary in amount from month to month. It’s smart to only use one credit card to make paying credit cards easier. However, it’s common to get mischarged by companies and lose track of your monthly spending. Autopaying your credit card may be a smart move, but it can quickly drain your budget. You’re better off not using a credit card or figuring out how to lower your expenses monthly.
6. Mobile Phone Plans
If you have a cell phone plan that varies in pricing due to your usage, it’s not smart to autopay. However, if your bill is consistently the same, use your credit card to make payments. This way, your main budget won’t be impacted if there are overcharges.
A huge disadvantage of automatically paying your cell phone bill is not paying attention to monthly pricing. No matter which option you choose, ensure you review your spending a few times each year to ensure your bill isn’t increasing in price.
7. Internet Services
It’s common for internet providers to raise their prices. Because of this, it’s not smart to autopay your internet bill. Price hikes usually occur after promotional periods end and are hard to catch if you autopay. Instead, be sure to check your pricing after promotional periods and avoid linking your checking account. Link your credit card and monitor your spending at least once per quarter.
8. Annual Subscriptions
Many companies, like Amazon, offer annual subscription options. These expenses can drain your budget if you’re not keeping track. Instead, pay these expenses monthly or set a reminder at least a few weeks before renewal to determine if you’ll keep your annual subscriptions.
9. Insurance Premiums
Like many items on this list, auto insurance fluctuates in pricing. Many companies normally increase your premium whether or not you’ve been in an accident. You’re better off paying monthly and to shop around every six months. Monitor your spending each month to ensure there are no price increases.
10. Loan Payments
If you’re looking to pay a large loan off quickly, avoid paying automatically. Instead, manually make this payment to add additional payment towards your principal amount. Not all companies automatically apply additional payments towards the principal amount. By taking a manual approach, you’ll ensure your extra payments get applied to your principal balance and avoid paying more interest.
11. Charitable Donations
Your financial situation can change overnight. It’s not smart to autopay donations because how they use your money can change, and you may want to change your contribution amount. It’s best to manually pay for donations so you can be sure you’re still contributing towards an organization you believe in.
12. Magazine Subscriptions
It’s tempting to sign up for annual or monthly magazine subscriptions to catch up on the latest news. However, unless you know you’ll use your subscription, you’re better off paying monthly. If you forget to pay for one month and rarely use your magazine subscription, your budget won’t suffer. Magazine subscriptions can be easy to miss if they’re less than $10 and you rarely check your spending.