Tuesday, July 26, 2011

Bill Pay

I bank at Wachovia which is now Wells Fargo. And according to this article, Wells Fargo's bill pay options works differently than Wachovia.

Wachovia debited bills paid through bill pay the day they were paid.  Wells Fargo debits bills paid through bill pay the day they are "sent".  And according to the article this results in, up to, a five day float in favor of Wells Fargo. 

Both systems have their pros and cons depending on what kind of customer you are.  Wells Fargo's system makes sure you've got money in your account when you send those payments out by bill pay.  If you live life close to the edge this might be a good system in that you and your bank are sure you've got the funds available to make these payments.  If you normally have a cushion in your account, then the risk based system, the old Wachovia system, would be better in that your money would not be tied up for days on end. 

For me, the switch from Wachovia to Wells Fargo required me to reschedule our one recurring auto payment from a few days before the end of the month to the first of the next month.  I had to change the send date to what was previously the paid date.

The rest of my recurring payments, the ones that are set on auto pilot, i.e. our mortgage payments, money transferred to savings is all set up as pulled payments (i.e. ING pulls the savings money from our Wells Fargo account).  Therefore, the change from Wachovia to Wells Fargo did not impact these payments or transfers.

The rest of my electronic payments are sent through bill pay, but not as auto payments since the amounts change from month to month and since I review those bills each month.  When I sent those payments under Wachovia I always had the money in hand so nothing changes under Wells Fargo.

So far, the payments I've sent by bill pay under Wells Fargo have been processed the same, in my mind, as with Wachovia.  I understand that WF is pulling the money from my account when I send the payment, but all payments are processed within a day or so, same as Wachovia, so I'm not really noticing that my money is tied up any more or less than under the Wachovia system.  I'm probably not noticing a change because when I paid bills under the bill pay system with Wachovia, I counted that money as debited that day.

What do you think of this change, how does your bank work, how to you manage this?

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