bank rates

Don’t Put Autopay On Autopilot

credit card computer keyboardThink of all the recurring bills you pay automatically with your credit card.

The gym, membership clubs, public transportation payments.

Indeed, there are lots of monthly, semiannual or yearly bills that make sense to pay automatically. It’s a great way to earn extra cash, points or miles while making sure you’re never late with an important payment.

But you can get burned if you leave autopay on autopilot. You still need to keep a careful eye on your credit card statement to make sure you don’t get overcharged. Some merchants do take advantage, hoping you won’t notice.

Here’s a list of what you should — and shouldn’t — pay automatically on your credit card.

What you should put on autopay

Utility bills: Not all utility companies accept credit card payments — my electric and gas companies don’t — but many do. Check with your local utility company to see if you can pay with a credit card. If they allow it, set up a system so your bill automatically gets paid with your credit card.

While electric and gas utilities are less likely to offer credit card payment, communications providers — cable television, telephone, cellphone and internet providers — often encourage it. It’s a good idea.

Indeed, many service providers offer cash bonuses for doing so. In my case, I was offered a $20 gift card to have my monthly cellphone bill automatically charged to my credit card, which I jumped at. I’ve been doing it for at least five years and never had a problem. But I always make sure my phone bill jibes with my credit card statement.

Insurance premiums: Like utilities, not all insurance companies let you pay their premiums with a credit card, but many do. Even if they don’t advertise that fact, they still might accept card payments if you ask.

While my life insurance company doesn’t let me pay with a credit card, my homeowners and automobile insurance company does. Not only that, but they credited me $5 because I paid them before they sent out the invoice.

What you shouldn’t put on autopay

Newspaper and magazine subscriptions: These publications are notorious for overcharging you when your subscription is due. If they have your credit card on file, they’ll automatically charge your card, typically a lot more than they charge new customers.

There’s a reason why some companies always ask for your credit card, and it has little to do with providing a customer service. It’s so they can overcharge you and hope you won’t notice.

My local newspaper charged my card for an entire year of service without asking me, at a price much higher than I had been paying. When I called to complain, they lowered the price significantly. I also told them to remove my credit card from their system.

A major sports magazine did basically the same thing. In fact, when I called to cancel, their own agents told me it was much cheaper to go on the magazine’s website and resubscribe that way. Not only did I get a much lower rate, but I got a free NFL jacket.

Internet antivirus protection: One of the biggest antivirus software providers recently charged my credit card $85 to renew my antivirus protection for a year. Last year I paid $30 to cover three computers.

No doubt when I ordered it, buried in the fine print was my consent to have them automatically renew my subscription. But I at least thought they’d give me a head’s up.

Not only was I angry they charged my card without telling me first, but you can buy the same protection on their website for just $50 — or go elsewhere. That’s what I did.

Don't miss out on the next bank deal. Get the newest deals delivered straight to your inbox!

Comments (0)
1 Star2 Stars3 Stars4 Stars5 Stars (2 votes, average: 5.00 out of 5)
No Existing Comments

Comments are closed.