By Sean Bryant
If you’re like most people you probably have a handful (or more) worth of bills that need to be paid each month. These could include your credit card bill, electric bill, water bill, and let’s not forget your rent or mortgage.
With all these bills it can be a headache to make sure they’re paid on time. But it’s something that needs to be done.
That’s where financial technology, or “fintech” could help. Fintech firms are stepping up more and more to help people with saving money, managing credit cards, budgeting and paying bills on time – straight from an app.
Read on to find out why payment history matters, what bills affect your credit, and three personal finance apps you can use to pay your bills on time.
Paying each bill on time is one of the most important things you can do for your credit, since your payment history makes up 35% of your credit score.
While you might not think one or two missed payments can have a big effect, think again. Not only are you going to be paying late fees, but just one missed payment can lower your credit score significantly.
Someone with a score of 780 could see a drop of 90 to 110 points. If your score is on the lower end, the impact will be less, but it will still have repercussions. Lower credit scores can mean higher borrowing costs.
It’s important to pay each of your bills on time, no matter what the bill might be. However, it’s also important to understand which bills actually affect your credit score.
The following credit accounts could lower your credit score if payments are not received on or before their due date:
Does this mean other bills will have no effect? Not all all.
For example, your landlord might not report late rent payments to the three major credit bureaus, but if you go an extended period of time without payment, not only will you be evicted but they might also send the unpaid money to collections.
If your debt gets sent to collections, it’ll end up on your credit report, significantly reducing your credit score.
Making sure your bills are paid on time is easy to do. It can be as simple as marking due dates down on a wall calendar in your kitchen or office. Or you could also add each date to your smartphone calendar with an alert the day before they’re due.
You can also make it automatic by setting up autopay for each bill. This will automatically make a payment on a certain date each month. For many, autopay is the simplest, most hands-off way to avoid missed payments.
Unfortunately, not every bill will have autopay as an option.
Want to make it even easier to pay your bills on time? Several different Fintech apps have become available that make it easier than ever to pay your bills on time.
Here are three to consider...
Prism collects all the data from your monthly bills and alerts you before your payments are due. This means no more excuses for late payments.
To get started using Prism, connect each of your monthly bills to your Prism account. Next, set up your preferred payment account – either your checking account or a credit card.
Prism will pull all this information into the app and you’ll be able to see both your financial account balances and each upcoming bill all in one place.
With Prism, you’ll never need to worry about your bills again. When you have a bill due, you’ll receive a notification. You can then select the payment account and the date you want the bill to be paid. No more paying bills on multiple websites, since everything can be done inside a single app.
Remember back in the day when you needed to purchase the latest Quicken software from a store like Best Buy every year? Gone are those days, because now you can download the original personal finance management software online.
With Quicken you’re able to dig deep into your monthly spending to see where your money is going. Plus, you can create a budget to make sure you’re meeting your financial goals. But now you also have the ability to view and pay your bills.
Within one easy-to-read screen, you can view each of your bills, their due dates and the amount due. Plus, you can set up alerts so you know before each bill is due and make a payment within the software.
Quicken also shows your future cash flow based on your payday and upcoming bills. This helps ensure you don’t overdraft your bank account.
Similar to Quicken, Mint.com is one of the pioneers in personal finance management. They allow you to view your entire financial picture in one place.
Once you sign up for an account, connect your financial accounts. You can include everything from your checking and savings accounts to your credit cards and investment accounts.
Mint then pulls in all your transactions to help with things like budgeting and investment portfolio tracking. They can also spot when one of your investments charges more in fees than you should be paying.
But most importantly for the purposes of paying your bills on time, Mint also includes a bill payment tracker. Similar to the other apps we talked about, with Mint you can view all your upcoming bills in one place.
Sign up to receive alerts on your smartphone before each bill is due to help you avoid a missed payment. The one thing Mint lacks compared to Prism and Quicken is they don’t give you the ability to pay your bills directly from the app.
Your credit score is one of the most important numbers in your life. It can have a huge impact on whether or not you’re approved for a loan.
Ultimately, whether you choose to use a mobile app, autopay or calendar alerts, the best option for keeping your bills organized is whatever option works best for you.
Sean Bryant is a Denver-based freelance writer specializing in personal finance, credit cards and travel. With nearly 10 years of writing experience, his work has appeared in many of the industry's top publications. He holds a Bachelor of Arts degree in Economics. He also runs OneSmartDollar.com.