Pay Bills Without Stress

Finding convenience and security

Is it time for you to join up? There’s no shortage of people who say it’s the way to go.

“I’ve never had an issue with paying bills online in the years since I signed up,” says Gerard Corbett of San Bruno, Calif. “It saves time and money because you can avoid late charges and going to the post office.”

Erin Mitchell of St. Petersburg, Fla., says she and her husband hesitated over the new technology. “It wasn’t until one of our checks went missing in the mail, causing us a lot of grief, that we decided to try online bill paying. Now we love it,” she says.

There are some complaints, even from users who are satisfied overall. “It does take four days or so for the bank to generate a paper check if the vendor doesn’t accept electronic payments,” says communications consultant Katherine R. Hutt of Washington, D.C. “So you have to be a little bit organized. I do still have an old-fashioned checkbook for those times when you absolutely have to write a check on the spot."

Still, some people remain unconvinced. “I guess I just feel safer with my collection of canceled checks to prove I paid my bill,” says Daniel Buckley of Abington, Pa. “I have trouble getting used to the idea of someone else paying my bills.”

Fear of hackers keeps other people away.

If you’re unsure about the idea, consider signing up with one creditor, pay one bill, and see how it works.

There are three basic types of systems:

1. A single website set up by a financial institution or third-party service. Most large banks offer their customers free bill-paying because it cuts the bank’s cost of doing business and attracts customers. There’s also a free private service, MyCheckFree.com. Other third-party services, such as Intuit’s PayTrust.com and FiServ.com’s MyMoney, which runs on the Facebook platform, charge a monthly fee.

While some banks and private service providers limit payees to big businesses like credit card issuers, department stores and utilities, others let you pay virtually anyone with a U.S. mailing address.

On the payment site, you create a list of payees that you can update at any time. To pay a bill, you click on the payee, enter the amount and the date, and verify that transaction details are correct with a final click.

Keep in mind that your payment may not be dispatched instantly through cyberspace. If your bill-paying service and your creditor have not agreed to allow electronic fund transfers, your service may need to create and mail a paper check. In those cases, you must allow up to a week for the Postal Service to deliver your payment.

2. Individual creditors with bill payment websites. Sign up with a creditor—say, your electric power company—and you’ll receive an ID and password giving you online access to your account details. You enter a payment amount, and the system electronically deducts the amount from the bank account you have specified.

Remember to enter the transaction in your check register just as if you had written a check.

While the need to log on to each creditor’s site is considered a nuisance by some, the convenience of having a payment credited immediately, or at least within one day, is an important advantage to others.

3. Individual creditors with automatic payments. You can authorize many creditors to deduct payments automatically from your bank account with no action on your part. This is arguably the most convenient form of electronic bill paying because you don’t have to own a computer to participate.

You receive your bills in the mail as before, but you don’t have to do anything except enter the deduction in your check register on the payment date. You’ll get the bill two to three weeks before the due date, in case you have questions about it.

If the current trend is a reliable indicator, taking pen in hand to pay your bills seems destined to become as archaic as carbon paper and typewriters.