August - September 2022 Active Retirees Magazine

Page 26

Finance /Beware of Direct Debits

Beware of

direct debits

D

Are things coming out of your accounts that shouldn’t? Have you forgotten what you are paying automatically? It’s time you had a good hard look at your direct debits.

irect debits: they can be a great idea if you want a no-fuss way of paying bills or regular subscriptions or memberships. Or perhaps you’re being offered a discount or cheaper rate by a business if you agree to pay by direct debit. But once you’ve signed on the dotted line, they can be easy to set and forget. Here’s why you might want to keep a sharp eye on your direct debit arrangements. They can become problematic if you don’t have enough money in your account or a limit on your credit card when the payment hits. Then you can wind up being charged a dishonour or overdraft fee by both your financial institution and the service provider. As with any electronic payment, mistakes can happen. You still need to be vigilant about checking your bank account or credit card statements to ensure you are being charged correctly. It can also add an extra layer of complication to your financial arrangements when you decide to cancel a direct debit arrangement.

Doing direct debit right The Australian Securities and Investments Commission’s Moneysmart website has some advice for people about direct debit arrangements. For starters, it suggests you should only enter direct debit arrangements with a service provider you trust and when you know how to cancel the arrangement if you no longer need it.

AUGUST - SEPTEMBER 2022 ACTIVE RETIREES |

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If you’re being lured into a direct debit by the promise of a discount or lower rate, it suggests checking if you’re eligible for the same discount if you set up an automatic payment via online banking. The difference is an automatic payment lets you stay in control of when the payment starts, stops, or changes. Often, it’s only when someone wants to cancel a direct debit that they find out how much work is involved.

| WWW.PROBUSSOUTHPACIFIC.ORG


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