Why Speed-Reading Your Bills Can Cost You
|March 8, 2013|
This month’s electric bill gave me quite a shock. It was $268 — for a one-bedroom apartment!
My eyes darted to the “usage” chart that appears on the left side of the bill. No problem there — our electric use for February was our lowest yet, beating our November 2012 record. My eyes darted to the right side of the bill, where the bill is broken down. There, among all the random $6 and $8 charges the city tacks on for drainage service and “street service” (whatever that is) was a $200 “deposit.” There was also a $0.90 “late payment fee.”
I called our service provider and was told that the deposit was charged upon change in residence (we’d just moved) to “customers with a history of late payment.”
Turns out, all our payments between September 2012 and February 2013 had been flagged as late, even though the withdrawal dates from my checking account prove otherwise. I would have noticed there was a problem if I’d looked carefully at the itemized bill every month and seen the late payment fees (which ranged between $0.10 and $0.90). You’d think I would have noticed, given that I pay the bill manually each month, instead of relying on automatic payments. But I had only been checking our electric use, scanning the bold number at the bottom of the bill and making the payment. It wasn’t until the $200 charge made me jump out of my chair that I took a closer look.
The energy company is looking into the issue, and I’m waiting on resolution. In the meantime, I’m wondering what else I’m not noticing — and what it’s costing me. Even small billing errors can add up over time. Me Vs. Debt, a blog that tracks the blogger’s (Amanda’s) journey out of $20,000 in debt, chronicles a similar encounter with credit card billing errors. Despite making no new purchases on a balance transfer card, the higher purchase APR was being applied to small amounts of the balance. Because the resulting finance charges were so small, they were barely noticeable — but, given time, the cost would have ballooned.
Meanwhile, the anonymous blogger behind iHeartBudgets (a blog that focuses on the fun side of budgeting) has a guide on billing errors, which includes all the errors his family has found — and how much catching those errors has saved them. Examples include early credit card payments mysteriously posting after the due date; grocery coupons that didn’t ring up correctly; mysterious items added to restaurant bills; nonsense charges added to hotel bills; and improperly processed returns. The grand total saved by watching bills like a hawk? iHeartBudgets estimates that it’s been $3,000 over the course of a year.
That’s motivation enough to take a few extra seconds scanning my bills.
If you’re also trying to be more mindful of where your money’s going, check out our roundup of the most interesting personal finance blogs of the week.
Frugal Rules offers some tips for easier tax filing.
Stupid Cents walks you through the process of creating your first budget.
Ready for Zero lists 10 common mental barriers to paying off debt.
Mr. Money Mustache attempts an experiment — wasting money for once.
Steadfast Finances outlines the first steps everyone must take on the road to riches.
Lauren of L Bee and the Money Tree explains why she does not coupon.