A) go directly to the companies (that have to pay) and tell them to draft from my account
- Make sure you know how to stop this feature, so that they don't keep pulling from your bank account. Some people use an automatic billing to a bank account or credit card to pay their gym membership, then forget to turn it off even after they stop going.
- Best for bills that don't change very often, that way there are no surprises.
- As long as you have money in the account, it will go through.
B) tell BOA to send them a check every month via Bill Pay
- Bills that can be paid electronically work the best, because the money gets to the company in a day or two, instead of a week.
- they can handle almost any company or individual by sending a check by mail. But it takes longer.
- The money comes out when the bank sends the check, not when the company cashes the check.
- Have to get proof of payment on the company website, or when the company sends a receipt. there will be no scanned check on the banking website.
C) tell BOA to direct deposit to their account (not always possible)
- I have used this only for mortgage payments to the same bank.
There is 4th option. If the company can handle an automatic draft from your bank, they might be able to automatically charge a credit card. That means only one payment from the bank each month to pay the credit card bill. This takes dedication to not skip a payment and owe a lot of interest. You can also earn cash back, or miles for these transactions.
A utility bill can sometimes be put on a level payment plan. They estimate your bills for the year based on past usage. They charge the same amount for 6 or 12 months, then they adjust to reflect actual usage and repeat the cycle.