Why make things easy, when you can make them complicated?


Let’s get right to the point today shall we? I go out of my way to ensure my personal finances are significantly more complicated than they should be. In fact, I’d even go as far as to say that I sleep better at night because of it. No, I haven’t lost all my marbles, I just hate the idea of automating my finances.

I know I’m probably in the minority here, seeing that numerous personal finance blogs preach the wonders of automating your finances. I won’t try to convince you my way is better (even though it is), but allow me to at least explain myself further. First, I’ll list off all of the regular recurring payments I have each month.

  1. Mortgage
  2. Cell Phone
  3. Car Insurance
  4. Credit Card(s) – Varies depending on monthly balance (usually around $1,500)
  5. Charitable Contributions
  6. Utilities

I may be forgetting one or two other bills, but for the most part I think that about covers it. I could theoretically set up an automatic withdrawal from my checking for each of these bills, allowing the companies access to my checking account. As the bill comes due, the company would pull the money from my checking account.

Now, I don’t know about you, but that totally freaks me out. Getting married and sharing a checking account with Girl Ninja was scary enough, I couldn’t imagine giving a bunch of random strangers access to my account as well.

I’ve read horror stories about people who thought they set up a $200/monthly payment and were shocked to find out $2,000 was withdrawn instead.

Or how about the person that had their car payment scheduled for the 8th of every month. Well it just so happened that on the night their account was to be debited, their bank was beefing up security protocols and restricted all customers accounts for a few hours. As a result, the payment never processed. But because it’s suppose to be automatic, you never think to check and make sure everything went smoothly. Thirty days later you are dealing with an angry Toyota representative hounding you for being one month past due.

No thanks. Automatic payments don’t sound worth it to me.

To be perfectly honest, I actually enjoy manually paying my bills. It reminds me how much money comes in and out of our account each month, but more importantly it makes me want to continually shop around and make sure I’m getting the best deal possible. I mean how many of you having been paying the same cable bill or car insurance bill for a couple of years? That’s insane, every year I shop around, and every year I find better deals than what I currently have. Un-automating my finances keeps me intimately involved in our personal finances. And I need not remind you, making love with money is my favorite kind of romance.

Do you automate your finances? Why or why not?

38 thoughts on “Why make things easy, when you can make them complicated?

  1. Funny you just wrote this because I just got off the phone with my electric company. I received a bill that told me that I didn’t pay my last one and when I checked my records, it was there. When I called them they gave me some mumbo jumbo about the meter read date and told me what my current balance was. Suffice to say, manually paying bills is not flawless. My preferred method is automated but only if I’m allowed to use a credit card, like you, I do not like others having access to our checking account.

  2. The only reason I stick with electronic payments is because it’s 2014. If it was up to me, I would be still licking a stamp and sticking the envelope on a snail to deliver my bills. As a HR Manager for years I tell people all the time, never take your bank statements for granted. Take the time to sit down and verify it…..I don’t know if anyone is listening….nope they are not listening.

  3. I have to agree. I enjoy paying my bills manually rather than automating them. I feel like I still have some control over my money. It actually frustrates me how some places request automatic direct debt payments.

  4. I’m personally a fan of automation. I think that the amount of time saved making manual payments each month is worth the one-off hassle every couple of years with a missed payment.

    However, I completely understand where you are coming from and think that making manual payments is a good way to keep oversight of your bank account and statements.

  5. More and more lately when I log into Mint I see that our Electricity bill was paid on some day previous. I think “oh, that’s right, that bill WAS due on the 15th!” Bottom line is with the mortgage, utilities, charitable, *cough cough* car payment * cough* I would be bound to screw it up some how; and a $15 late fee or whatever it might be would just be mocking my lack of being on top of the ball.

    Great article!

  6. I don’t want any third party getting into my checking account either, mainly because I don’t want unexpected debits from my balance that would cause me any kind of cash flow problem. Granted, a couple of hundred dollars here or there is no issue, but I don’t want a large debit from my account over which I have no control. And since online banking is so simple now, it takes just seconds to pay a bill and make sure the account is being debited when I want, not when some company wants. As for keeping track of payments, that’s easy enough to do from my bank’s website. I also keep a little spreadsheet where I record dates and amounts for each fixed expense.

  7. I automate most of my bills, straight on to my credit card. I also automate push payments for my mortgage and when I had a car payment, that as well. But I refuse to automate my credit card, I review all the charges against quicken where I have logged everything so I know when something is off, and then and only then pay my credit card.

  8. If I take the time to post a comment, will you at lest take some to read/respond to it? You never seem to respond to any comments. I mean- it’s not like you have 100’s of comment to respond to.

    • I read every comment I get. It’s true I don’t typically respond to most comments. I try and limit the amount of time I spend on my blog to the one hour I spend writing. Sorry if that is bothersome, but I’d burn out real quick trying to respond to the comments.

  9. I am much the same. I pay my student loan min payment, and car insurance automatically because I am required to, as well as my savings allotment from my paycheck into my emergency fund, but I pay everything else manually. It gives me a little bit of freedom over what day they are paid, but also forces me to be more mindful and aware of my finances.

  10. I manually pay each of our bills. I too am not a fan of automatic withdrawals from my account. Too many times there is an error on a bill and it’s always in their favor. If it was automatically withdrawn, they would have my money and I’d have to fight to get the bill corrected and then have my money refunded. No thanks. I like to have control over what I pay and when. I pay all bills online, but on my own. I think it’s weird that so many people give over their control of their money. Glad to see that others have a similar mindset.

  11. I pay some manually, some automatically. I have a system for checking if it’s paid – I check twice a month so I don’t run into the issue that you are concerned about.

  12. I have some of my stuff automated, my electric, water, cell phone, netflix and cable bills all get charged to my credit card monthy, but I check my accounts at least every other day to make sure charges are going through properly, and in the case of my electric and water bills, as soon as I get a notice that a new bill has been issued, I go to the website to see what I’m going to be charged. If it were something astronomical I’d immediately call them because the payment isn’t processed until usually about 3 weeks later. Plenty of time to dispute or remove my account info (so they can’t charge me) if necessary. I also reconcile all those payments the day/day after they are taken from my account.

    My mortgage, car payment, credit card payment and car insurance bills I make those payments manually each month (or yearly with the car insurance) So if I wanted to apply more to my car payment, or if for some reason I’m short for the credit card payment (that one month I transferred too much from my checking to my savings before paying off the CC statement! ARG!) I have the freedom to do so.

    As with all personal finance, there is no one size fits all. it’s whatever you are comfortable with!

  13. I prefer to pay my bills online, but not automatically. I am always worried that I won’t have the money in the account when it tries to automatically take the money and then I will get charged late fees. I usually prefer to make sure that I have the money, then log in and pay the bill online. I do have a few bills automatically withdrawn, but I think my husband set them up, or I didn’t see the other option when the account was created. The automatic ones are satellite TV, homeowners insurance, and a child sponsorship. But even having those few automatically come out instead of me purposely moving the money makes me nervous sometimes….

  14. I am one of the people who had a bad experience with bill pay–in the ’80’s. My checking account was overdrawn by $3000. It was a horror.

    However, nowadays, I pay most of my bills automatically, through my bank. I think anyone who sets up automatic payments and then doesn’t check on them (much easier now than in the 80’s!) deserves what they get.

    I don’t automate all payments, but I automate a number of them, and the rest I schedule when I want to pay them–sometimes having a day or two leeway is advantageous.

  15. Same here! Well, sort of. I have my utility bills withdrawn or paid on my credit card automatically, but will pay off my credit card balance on the 15th and 30th of the month. I also enjoy it. 🙂

  16. I manually pay for my bills. I can’t stand the thought of someone having access. I also have that my gym won’t let be pay them manually. I understand why they don’t but I don’t like it.

  17. I have my credit cards set to automatic payments, as well as one of my student loans (to receive an interest rate deduction) but I still pay my main student loan by manually assigning the payments. It just feels more gratifying paying a huge lump sum each month.

    Even though my credit cards are paid automatically, I do check my transactions and my checking/savings accounts once a month to make sure nothing weird happened.

  18. I manually pay our electric bill and credit card statement. I have other bills like water, internet, netflix, and hulu on autopay. I manually pay our insurance bill too! I don’t pay until the last day possible online.

  19. Not only do I prefer paying my bills myself, but I transfer money for my savings goals myself as well. It makes me feel in control of my finances.

  20. When I had car payments I had an automatic deduction which saved me half a percentage point or something on interest. But it drove me absolutely bananas!!! I like to have control over when I pay my bills (even if it is just a day or two difference) and I like to stay connected to my finances by reviewing and paying my bills as they come in.

    Recently my paycheck direct deposit didn’t go through due to a bank system upgrade. I didn’t notice for 5 days because after 10 years with no problem, I take for granted that my check will be there. That is a mistake I won’t make again soon.

  21. Automatic for student loans, credit cards, phone, rent, and Internet. I have notifications when payments should come out in YNAB or GoogleCal. One of those payments is tied to a credit card (Internet), two to our debit account (credit cards and student loans), and two are checks automatically sent by our bank (we don’t write them or send them, they just show up on the send dates–they’re to our family for cell phones [yay family plan] and landlord for rent). Electricity and gas I pay manually online with email notifications.

    I take five minutes every morning with my coffee to update our YNAB, check our accounts, and double-check upcoming payments. We’ve never missed a bill. I’ve also caught at least one bogus charge on a credit card (resolved that day) AND checked up on our HSA provider about un-timely deposits of pre-tax contributions into our HSA account (seriously? two weeks?) because of my daily morning routine. Gives me time for the caffeine to kick in and financial peace of mind.

  22. I am very ANTI automating. I’m old school that way. I like to physically write out the checks for the same reason as you – so I am reminded how much goes where. I am also a little paranoid too and don’t want to give anyone access to my financial accounts.

    For some reason, writing out checks keeps me on track of how much money I have left to spend on me.

  23. I automate the actual payment but I manually enter each one into the expense tracking software before it occurs, so in a way I am manually doing it but if I forget I have a backup to catch me.

    The only three that I don’t automate are the property taxes, homeowner’s and life insurance.

    I also prefer to have the bank send the payment instead of the 3rd party taking the payment.

  24. I like to manually pay all my bills because I work off a $0 dollar budget..I budget for my few automated withdrawals, pay everything (including credit card we use for all our day to day spending) in full that is coming due in that pay period, and every penny left over gets split between budget categories and savings.

    the only items I auto-pay are things like tolls (it draws in $40 increments as I use them), kid’s college funding (pre-paid tuition plans), car insurance automated transfers to my millions of savings accounts that I use as virtual budget accounts (shout out Cap 1 360 formerly ING) and regular savings account/efund. I literally have like 10 cap one accounts that money gets dumped into each week for predictable future expenses, like HOA dues, car maintenance, vacation funds, house expenses that aren’t normal monthly expenses but not “emergencies” either, etc etc.

  25. When I was first reading this, I thought Ninja was referring to the automatic bill pay service that banks set up, where you provide every bill/ debtor, account numbers and link it to withdraw automatically from your checking account? I have NOT signed up for this, but I do have most of my bills auto withdrawn directly with the lender or provider. Ninja-do you write a check to pay your mortgage? I wasn’t given the option to “manually pay.” It’s part of their original loan set up..”here’s the escrow, taxes, and sign this paper agreeing to have your payment auto withdrawn”. Also, how do you (and others) feel about getting your bills in the mail? I prefer it this way, but there is such a push to go electronic. My statements would get lost in my 100s of emails….

  26. I pay everything through my online banking; it takes me two minutes once a month, no more checks to write, or stamps, best thing I ever did for my finances, that way I know when it’s going out; no surprises.

  27. Only our toll transponder is automated because that’s the only way you can set it up. I pay some bills online, but not automated. Just ones that I can use a credit card in order to max rewards points. And, of course, those are paid in full each month.
    I’m a little weird in that I like paying the bills. Doesn’t take long–maybe 20 minutes 2x month. By doing it manually, I can vary the amounts I put into savings and additional mortgage principal. I’ve never had a problem with missed payments, incorrect payment amounts or other stuff talked about here. But, as they say, whatever floats your boat…

    • I also enjoy the actual process of “doing the bills”. goes back to my days as a kid where I’d empty my piggy bank, count the pennies, and make all my grand plans and sort them into stacks, I suppose 🙂

  28. I automate all I can (phone, satellite, Netflix, auto insurance, storage unit rental) onto my Amex to get cash back reward. Then pay balance in full each month. I also get discounts on phone and insurance for having them automatically charged.

  29. I used to pay manually because, like you, I was also worried that something would go wrong and all of sudden I have cash flow issues. What made me go automatic was doing equal pay for utilities where possible. So now, I mostly have fixed debits coming out of my checking and I still monitor each payment on schedule just to make sure we’re not late.

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