How to Pay Bills

Every month you have to pay for the apartment, utilities, and other services. You may also have one-time payments, such as a deposit when renting an apartment. Typically, you will be given a choice in how you pay these bills in Woburn, MA. The list below will help you understand the different ways to pay bills and their potential advantages and disadvantages. Knowing how they are done can help you avoid additional fees, including late payment or non-payment penalties.

Check

Definition

Checks are forms you fill out to pay for something from your checking account. The check indicates the amount and the name of the person or the name of the company to whom the payment is intended. This amount will be withdrawn from your checking bank account when that person or company receives the check and puts it in the bank or cashes it out. A similar account can also be opened with a credit union.

Benefits

This option is convenient to use after you apply and open an account with a bank or credit union.

Risks

If you pay bills with checks and don’t have enough funds in the bank, the bank or company you send the check to may charge you a fine.

Postal money order

Definition

A postal money order can be used instead of a check. You can buy a money order to pay a company or someone else.

Benefits

Risks

Cash

Definition

Cash is the money you have on hand.

Benefits

Risks

Credit card

Definition

A credit card allows you to borrow money within a specified credit limit. If you do not pay the entire balance, you will be charged interest and may also be charged other fees in accordance with the terms of the contract. You should be prepared to make a minimum payment every month. To pay off debt faster, you can pay more than the minimum monthly payment.

Benefits

Risks

Online payment

Definition

You give your bank information about a company or service provider and the bank pays according to the amount and schedule you specify.

Benefits

Risks

Automatic or direct debit

Definition

You provide a company or service provider (such as a mobile or utility company) with your checking account information, and they will withdraw money from your account every time you are owed a fee (for example, every month).

Benefits

Risks

If you pay bills with direct debit without having enough funds in the bank, the bank or company you pay may charge you a fine.

Warning: When money is automatically withdrawn from your account, you may accidentally spend more than you have in your account. If you do not have enough funds in your account to make automatic payments and other payments you made, you will be charged heavy fines. To stop automatic payment, you need to contact both the receiving company and your bank.