Did you know that if you automate your payments you could be spending Sunday nights at the cinema with the children rather than sitting at the kitchen table with your calculator trying to balance your cheque book? Well, if you didn't, the following are three great (free!) ways in which to automate your payments and make your life so much easier:
The Standing Order
All creditors now allow you to make a monthly standing order payment to repay their debt. In fact, most creditors prefer this method as they're fairly sure they'll get their money on time (although it is not a guaranteed form of payment - standing orders, like cheques, can "bounce").
The upsides of a standing order repayment scheme are: (i) you know the payment will be made on time (thereby avoiding any late payment fees); (ii) the monthly amount is fixed, so its easy to budget for; (iii) after a while you don't notice the money going out of your account, so when you've finished repaying the debt, just transfer the standing order to your savings account.
Although payments via standing order doesn't mean that you reduce the number of creditors that you have, your bank should let you set up as many standing orders as you want (provided you have the money to pay for them). Doing this will make the day-to-day running of your account(s) so much easier.
The Direct Debit
The direct debit is the payment method of choice for creditors. As with the standing order, the direct debit is an automated payment from your bank account. However, unlike the standing order, a direct debit is not really for a fixed amount each month (although, in most cases, practically speaking, the amount is fixed at the same sum). Instead, a direct debt mandate (the authorisation you give to your creditor to take money out of your account) says that the creditor can take as much as they want. For this reason, you should be careful before giving a creditor a direct debit mandate - make sure both of you (i) know the day the money is going to come out of your account; and (ii) as much as possible, know the amount to come out of your account.
Not really ideal for all payments, the direct debit is, however, really useful for utilities bills. Just keep in mind that with the standing order you are the one sending the money to your creditor, whereas with the direct debit your creditor is asking your bank to pay them (so it's a little like giving someone a blank cheque!).
Online Banking
Becoming very popular is to open an account with a bank that lets you do all your banking and bill payments via the internet. Internet banking is a great way to stay ahead of your bill payments and finances without having to leave the comfort of your home or office. Having said that, do make sure that you check to see if your bank is going to charge you for processing transactions via the Internet - as some do - before going ahead and doing it.
And finally...
As you can see, if you give some thought to automating your finances you could find that you have lots of spare time to spend doing more enjoyable things - like a night out with the family!