Do you pay your bills out of a savings or checking account?

Do you pay your bills from a checking or savings account?

  • Checking

    Votes: 103 90.4%
  • Savings

    Votes: 0 0.0%
  • Other (specify)

    Votes: 11 9.6%

  • Total voters
    114

tzolkin

DIS Veteran
Joined
Jan 3, 2008
I was wondering if someone would reply with this. I don't write checks either, I do online bill pay from my checking account. But those electronic transfers are actually checks, since the definition of a check is a document asking your bank to send money to another person/business, in this case it's an electronic document rather than a physical one.
I was thinking the same thing. For most payees the bank does send the "checks" electronically, but if you're doing online bill pay to a small business the bank will actually write them a check and mail it on your behalf.

I guess. But there seem to be a growing number of people who have no checking account at all. I suspect they put everything on a credit card and only have one payment come out of their savings per month
Does your daughter have a checking account? Or has she always been using just savings?

I purchase almost everything with my credit card (don't use the debit at all), but there are a few items that do not accept credit card payments (or charge a fee) so have to pay those through my checking account.
 

tvguy

Question anything the facts don't support.
Joined
Dec 15, 2003
I was thinking the same thing. For most payees the bank does send the "checks" electronically, but if you're doing online bill pay to a small business the bank will actually write them a check and mail it on your behalf.



Does your daughter have a checking account? Or has she always been using just savings?

I purchase almost everything with my credit card (don't use the debit at all), but there are a few items that do not accept credit card payments (or charge a fee) so have to pay those through my checking account.
She has her own checking and savings accounts opened at the same time.
 
  • luvsJack

    DIS Veteran
    Joined
    Apr 3, 2007
    Some creditors will waive the fee if they can see there was a possible problem with the bank or because she has previously paid on time or just because they feel like being nice today. Wouldn't hurt for her to ask.

    Sounds like she has been doing things this way for awhile without issue and then a big issue. I hate that for her. I completely understand how new home ownership and all the expenses that go with it can be overwhelming. Not sure why some are acting as though they have never made such a mistake but assure your dd it does happen to just about everyone.

    If she is looking for advise, suggest she use her checking account for bill paying. If she isn't, well she just learned a lesson and I am sure she can come up with a solution.
     
    Joined
    Oct 23, 2015
    Not sure why some are acting as though they have never made such a mistake but assure your dd it does happen to just about everyone.
    Nah I said if I didn't know the info it's on me. Never said no one makes mistakes. I just own up to them :)

    Being a new homeowner and the expenses being possibly overwhelming have nothing to do with this at all..zero. The OP's daughter just used the savings account like a checking account appearantly not understanding that they are not one in the same. It wouldn't matter what the expenditures were a savings account isn't designed for the usage of revolving purchases--a checking account however is.
     

    design_mom

    probably more like my dad than I care to admit
    Joined
    Feb 1, 2007
    We have accounts at 2 banks. (One account was mine before we were married and my husband's was his account before we were married. Both are joint accounts now, but we've had each for over 20 years.)

    I knew that "my bank" had a limit of 6 savings account transactions. I don't think it always has (probably not before 2008, it sounds like) but now there's a big notice on the account dashboard and when you try to make a transfer from a savings account. However, I thought it was a bank rule. I didn't know it was Federal. "His bank" doesn't have such a notice. I didn't realize there was a restriction on number of transactions from his savings account too.

    For years and years, I've had my paycheck direct deposited into my savings account. Each month, I estimate my expenses and transfer the amount I'll need into checking and pay bills from there. I keep a little money in the checking account to cover variances, but not much -- and can always make a second transfer over if needed.

    I have only recently started to use online bill pay -- and I have to admit that the thought did occur to me to just pay it from the savings account and save the transferring step. But I guess this is a good reminder why I shouldn't! (I don't make THAT many payments out of this account, so it would probably be fine most months, but... yeah... a couple of unexpected transfers could throw you over the limit!)

    OP... I'm sorry your daughter learned a costly lesson. I'm sure, even if it didn't involve banking, most of us have had one of those growing up.
     
  • luvsJack

    DIS Veteran
    Joined
    Apr 3, 2007
    Nah I said if I didn't know the info it's on me. Never said no one makes mistakes. I just own up to them :)

    Being a new homeowner and the expenses being possibly overwhelming have nothing to do with this at all..zero. The OP's daughter just used the savings account like a checking account appearantly not understanding that they are not one in the same. It wouldn't matter what the expenditures were a savings account isn't designed for the usage of revolving purchases--a checking account however is.

    I had to go back and read my own post. Thought maybe I named you. And you know what? I didn't.

    The overwhelmed feeling could have attributed to her being so upset. Besides, you don't know how it affected her choices or what happened.

    I am aware of what happened, I read the OP. I don't think he ever said she thought they were one and the same. A lot of people let their pay go to their savings account and then only transfer what they need to checking. Since these were set up as automatic withdrawals, perhaps she didn't see the need for the extra step because she forgot, didn't realize, wasn't told, whatever that she was limited to 6 withdrawals a month. Since this has never happened to her before and she has been doing it for awhile, I can see where perhaps being a little overwhelmed with all the new expenditures, she just missed it that there would be more than 6 or that now there would be a problem.

    People do allow automatic withdrawals from their savings. Usually more of the every 6 month type things like insurance but I know several people that do that. That way it doesn't slip their mind and totally mess up their checking account. So they are most certainly designed to use for automatic payments/withdrawals.
     

    mrodgers

    DIS Veteran
    Joined
    Oct 29, 2009
    i was amazed when dd showed me the on-line payroll options the company she works for uses. she can opt for directing depositing either percentages or dollar amounts of her pay into multiple separate accounts.
    Seems pretty normal. Been doing it that way at work since the start in 1995 here.
     
    Joined
    Oct 23, 2015
    I had to go back and read my own post. Thought maybe I named you. And you know what? I didn't.

    The overwhelmed feeling could have attributed to her being so upset. Besides, you don't know how it affected her choices or what happened.

    I am aware of what happened, I read the OP. I don't think he ever said she thought they were one and the same. A lot of people let their pay go to their savings account and then only transfer what they need to checking. Since these were set up as automatic withdrawals, perhaps she didn't see the need for the extra step because she forgot, didn't realize, wasn't told, whatever that she was limited to 6 withdrawals a month. Since this has never happened to her before and she has been doing it for awhile, I can see where perhaps being a little overwhelmed with all the new expenditures, she just missed it that there would be more than 6 or that now there would be a problem.

    People do allow automatic withdrawals from their savings. Usually more of the every 6 month type things like insurance but I know several people that do that. That way it doesn't slip their mind and totally mess up their checking account. So they are most certainly designed to use for automatic payments/withdrawals.
    I said revolving purchases. That's not the same as automatic payments or withdrawls.

    No need for snark I don't care to get in with you today. No need to reply :)
     
  • mrodgers

    DIS Veteran
    Joined
    Oct 29, 2009
    Was odd when I went to the ATM last week and the screen said "Thanks for being a customer for 55 years". I've only been with this bank since 1996, but the original account at the original bank was opened in 1965 when I was 7,
    That's not as odd as me opening my mail to find a Discover card and on the letter it said this is a replacement for my expired card and to cut up the old card. Had to call them and canceled the account stating I have never had a Discover card. They then told me I've had an account since the mid 90's. Nope, cancel it immediately! I had trouble getting them to cancel. I could have inadvertently signed up for an account, but you'd think I would have gotten a card in the mail earlier than 20 years later.
     

    RUDisney

    Mom to Ivan & Kristina
    Joined
    Apr 8, 2002
    Keep in mind that you can withdraw funds from your savings as a first party withdrawal as many times as you'd like in a month. First part withdrawal means that you go to a teller or ATM and take cash. You can go as many times a day as you'd like and take $3 each time. It wouldn't be efficient, but you can do it.

    The 6 per month rule is for third party transactions.
     

    Carlymouse

    Mouseketeer
    Joined
    Sep 22, 2017
    Yes. Well, her paycheck still goes into savings, and she will just transfer what she needs to pay bills to checking once per month.
    My paycheck goes into checking, but then I transfer a certain amount each month into savings. I have tried at times to set up a bill pay out of savings (unintentionally perhaps) and been prevented or had the payment blocked and then had to fix it. I think how she's doing it is fine, too (what you stated). I probably wouldn't have thought to talk to my own daughter about this detail. I did want to say, if she hasn't, have her call each institution. A lot of times the first time you have a late fee they will waive it if you call and ask for it to be waived, even if it's due to personal error.
     
    Joined
    Oct 23, 2015
    Keep in mind that you can withdraw funds from your savings as a first party withdrawal as many times as you'd like in a month. First part withdrawal means that you go to a teller or ATM and take cash. You can go as many times a day as you'd like and take $3 each time. It wouldn't be efficient, but you can do it.

    The 6 per month rule is for third party transactions.
    The financial institution could still have rules on how many per month withdrawls (which would count as physically taking money out or actual purchases).

    For instance one of the Savings accounts at my bank the rules are Up to 3 withdrawals or transfers per month; $2.00 for each additional and to qualify for an annual match of X amount you cannot have more than 4 withdrawls per year. Another Savings account which is actually the type of Money Market account we have it's Up to 6 withdrawals or transfers per month, A premium Money Market with our bank has the same withdrawl rules as the other Money Market account; up to 6.
     

    fla4fun

    DIS Veteran
    Joined
    Nov 12, 2006
    Why go to mom and dad in tears?
    Sometimes you want a safe place to vent to someone. I know there are tears when I get angry sometimes and tears when I get frustrated sometimes, and there are more likely to be tears if I am angry and frustrated with myself for messing up when I feel I should know better. It doesn’t necessarily mean she’s looking to them to fix the situation or that she feels incapable of handling things herself. She was just having a bad day . . .
     

    tvguy

    Question anything the facts don't support.
    Joined
    Dec 15, 2003
    My paycheck goes into checking, but then I transfer a certain amount each month into savings. I have tried at times to set up a bill pay out of savings (unintentionally perhaps) and been prevented or had the payment blocked and then had to fix it. I think how she's doing it is fine, too (what you stated). I probably wouldn't have thought to talk to my own daughter about this detail. I did want to say, if she hasn't, have her call each institution. A lot of times the first time you have a late fee they will waive it if you call and ask for it to be waived, even if it's due to personal error.
    She did, and they won't wave the late fees.
     

    tvguy

    Question anything the facts don't support.
    Joined
    Dec 15, 2003
    She had the money in the account. But there's a federal regulation that limits savings accounts to 6 transactions per month so once the 6 were done, the account wouldn't process any of the other transfers she was trying to do.
    Correct. Plenty of money in the account, just exceeded the 6 transactions per month limit.
     

    tvguy

    Question anything the facts don't support.
    Joined
    Dec 15, 2003
    That's not as odd as me opening my mail to find a Discover card and on the letter it said this is a replacement for my expired card and to cut up the old card. Had to call them and canceled the account stating I have never had a Discover card. They then told me I've had an account since the mid 90's. Nope, cancel it immediately! I had trouble getting them to cancel. I could have inadvertently signed up for an account, but you'd think I would have gotten a card in the mail earlier than 20 years later.
    Reading my credit report was interesting. It shows loans, and accounts at institutions that I have never ever had any dealing with. But those are the companies that bought up the original banks, etc. Sometimes DECADES after the loan was paid off.
     

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