Money, Automated

If a budget is the road to a positive financial destination, then automated payments are the maps to guide you there. These types of payments can help keep you on course to achieve any and all financial goals, and prevent you from losing your way on the journey.

Firstly, automated payments help with keeping track of bills.

“Automated payments can really help organize them, so you never miss a due date,” explains Laurie Campbell, CEO of Credit Canada Debt Solutions. “Automated payment systems can also help you keep those funds earmarked for bills.” Staying on budget can be tricky, and Campbell always recommends paying your bills as soon as they arrive and not waiting until the due date. By automating bill payment, the money is withdrawn from the desired account each month on a predetermined date to maintain your progress on the road to debt-free, penalty-free financial success—all without having to spend countless hours organizing and coordinating transactions.

Secondly, keeping up with all payments can assist in protecting you and your credit score from creditors and various agencies.

By minimizing chances of late payments, you are able to maintain good financial standing and a higher score, without also incurring penalties. Think of it as a financial airbag: no matter what circumstances life throws at you, automated payments can give you the peace of mind needed to deal with whatever comes your way.

But, as with everything, there can be speed bumps along the way.

“You have to understand your cash flow,” says Campbell. “You need to make sure funds are available.” Those with irregular incomes, for example, are especially vulnerable to this trap, and should pay close attention to the status of their accounts if they plan on using automated payments. In fact, while automating your payments may be extremely convenient for most, this system may not be the best for everyone; in this case, Campbell advises using alternative methods of budgeting.

“People often don’t take advantage of opportunities to get on top of their finances,” counsels Campbell. “Be judicious with using credit cards, and take advantage of free budgeting tools.” In particular, Campbell recommends an app called Mint to help manage your money.

Whatever road you find most comfortable, it is imperative to keep in mind that there is no one way to get to where you want your finances to go. And while there may be scenic side routes, back roads and wide avenues, automated payments keep you—and your money—on the highway to financial success.