How to Minimize the Risks of Paying Bills Online
Many companies have Web sites through which you can pay what you owe them. For example, you can pay your Chase credit card on its corporate Web site, then navigate to Capital One's Web site to do the same. In addition, many banks and credit unions offer online bill pay services, making it possible to pay multiple bills from one online location. Some banks may charge a nominal fee for online banking, but many offer the service at no charge to customers.
There also are third-party online bill pay services provided by Web sites like MyCheckFree.com and PayTrust.com. These free services allow consumers to receive, view and pay online bills from one secure Web site. You can also pay bills online with personal finance software. Quicken2010 Deluxe (sister company of PayTrust.com and owned by Intuit) is one example.
Wherever you elect to pay bills, you should first make sure the Web site is secure. Web page addresses, also known as URLs, begin with "http." However, to pay bills online, the Web page should always start with "https," which signifies a secure connection. Also, look for a padlock icon, usually in the top or bottom right corner of the browser window. Clicking the lock will reveal the site's security certificate [source: SSL.com].
Once you've decided where to virtually pay your bills, you must decide whether you want to pay them manually or automatically -- or both. Paying bills on a case-by-case basis is a solid move when the amount of the bill varies, as with utility providers, or when the bill is infrequent, as with bi-annual insurance payments. If, however, the dollar amount stays the same month-to-month, scheduling a series of future automatic payments can eliminate the risk of late fees. Keep in mind that automatic payments will be withdrawn even if you don't have enough funds in your account, and this can trigger overdraft fees.