For those of you that arrived here from my LinkedIn, this material is for those in or near financial hardship as well as anyone wanting to improve their financial best practices policies.
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Hi Folks! Let’s talk about the first step towards financial ruin (I’m serious) and how to avoid it. The evil AUTOMATED BANK DEBITS 
I say, unless you like stress & added expense, DO NOT sign or provide anyone with automated debit forms to withdraw money from your bank account under any circumstances. If you have some already, you can give your bank a debit-cancellation form for each one. Here’s why:
1. Your credit card holder agreements require you to review your credit card charges monthly to look for errors which must be reported to the financial institution within a deadline or YOU ARE LIABLE even for things that are not your fault if you fail to do this in a timely manner
2. You should be paying your expenses manually via online banking to prevent non-sufficient funds fees and reputational damage that occurs when items bounce when automated debits hit before you have sufficient funds
3. You should be AWARE of the state of your banking and this can only happen when you LOOK AT YOUR ONLINE BANKING REGULARLY in conjunction with your budget in progress
4. Phone, utility and other fluctuating monthly expenses may contain invoicing errors. You need to review these invoices monthly, note the due date and pay manually via your banking WHEN FUNDS ARE AVAILABLE
None of the above are possible when you have automated debits coming out of your bank account. If you think you’re making sure things get paid on time, you’re wrong. You’re costing yourself money ALL the time with NSF’s and failure to review your accounts manually. If you find it hard to change, it’s addiction to worst-practices and it needs to be corrected immediately.
In summary, automated debits lead to NSF fees and reputational damage which cost you money eliminating access to low priced credit and therefore reducing your ability to ever save, invest or prosper.
Special Circumstances
Often, mortgages and vehicle insurance MUST be paid via automated debit. In this case, and only if it is unavoidable, best practices require the use of a separate high-interest-savings account with a policy of leaving required funds in advance plus a buffer amount to be decided.
I hope this helps you!
DGB
Legal disclaimer: The material provided on this web site is for general information purposes only. It is not intended to provide legal advice.
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