I've noticed lately that a lot of the bills I pay online seem to be due on Saturday. I wonder if this is deliberate... The strategy, of course, with online bill paying, is to time the payments so they arrive at the last possible moment. The companies being paid must hate this-- sure it's a pain to have to open envelopes and deposit checks, but if people were worried about building in extra time to make sure their payments weren't late, the companies may have gotten their cash a little earlier.
With my online payments, I enter the day they have to arrive, and then my bank knows whether it's a same-day payment, or takes one day, or two or whatever, and calculates back the day that the money has to be paid out. That can't happen on a weekend or holiday. So if a lot of my bills are same-day, a Saturday due date means I have to pay them on Friday, not Saturday. Of course if banks aren't open on Saturdays anyway, I'm not sure it makes any difference to the company getting the money. So why don't they just automatically make their deadlines weekdays anyway? Maybe this whole thing is a stupid question anyway. Maybe I'm just needlessly obsessing over weird things. Maybe it's just a slow blog day...
Friday, December 14, 2007
Saturday's Alright
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9 comments:
Heh. My bills are due on all kinds of random days, but normally it's the same day every month.
It's possible that you're not being paranoid--after all, companies are always looking into ways to make more money off you. They're out to make a profit.
By making the due date a day they are not in business, they are increasing the chances people will miss the payment and they get to charge the customer interest and late fees, etc.
Last December my CC bill was due Dec. 31st, a Sunday. I paid it via the automatic machine, (on the Friday I think) but it didn't get credited to my account til January 2nd. Consequences: $64 in total interest paid. Lesson learned.
Most banks have partnered with large companies so that all payments are submitted electronically via ACH network, and the companies' systems are automatically updated. Number of paper payments sent via check are low.
Remember only the paranoid survive!
Let's say a bank has a return on capital of 5%, over a typical 30-day period month that is 0.17% a month...a rounding error to you and me, but I would be happy with nearly a twentieth of a percent extra interest for every dollar that comes in early, when you are talking to CitiBank numbers :)
That being said, it is nothing compared to $35 in late fee charges for a day or two late.
Credit cards are dangerous for most. I am often tempted by the "Take out $4 million on No Interest Card Deals" but I know we are all too easily lulled into being even a day late, then the plans fall apart...
Riiiight, but more and more banks are open on Saturday now, so they could theoretically pull from the account ...
While banks may be open on Saturday and some even Sunday, they generally do not post any transactions. They sit in "Pending" until the Monday floodgates open.
That is how Wells Fargo (my bank)is and a few others, but I would be interested to hear if other banks do actually post on the weekend.
I've always wondered that myself. I don't worry so much about a utility bill but if it is a credit card bill or my mortgage, I will pay them on Friday if it is due on Sat or Sun.
Racerx is right. Banks do not hard post an account on a weekend, only "memo" post.
I've noticed that too....my bills are mostly due the same date every month...so its whichever day that date falls on. I pay most all my bills online. I've paid my car note 4 days after the due date(Friday was a holiday and so was Monday) but I was not charged any late fees. I have also paid one of my credit cards on a Monday even though it was due on Sunday...no late fees there either. So long as your payment falls within the "grace period" you are ok. You might want to verify with your credit cards people how many days after your due date do they consider your payment late to be on the safe side.
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