Verizon has announced that they will begin charging customers a $2 fee for paying their bills online via credit card, in order to "continue to support these single bill payment options in these channels and is designed to address costs incurred by us for only those customers who choose to make single bill payments in alternate payment channels (online, mobile, telephone)," the company says.

While the fee applies to one-time online payments, there will be no charges for using the company's AutoPay option, which will pay your bill automatically each month via either credit/debit card or directly from your bank account.

Not totally surprisingly, there was a lot of uproar online about the new fees, with GigaOm calling it an "excessive" charge.

But $2 not only seems excessive; it runs counter to the policy that Verizon and all service providers – whether wireless, wireline, cable or utility – have implemented in recent years: cutting the enormous cost of issuing and sending paper bills and processing hand-written checks.

One of Verizon's obvious goals is to get people to enroll in AutoPay, in order to ensure that they get paid each month and have fewer customers to chase for payments.

Since the AutoPay option still accepts credit cards (meaning Verizon still has to pay credit card processing fees), they can't just argue the change is just about processing fees, says GigaOm. However, according to the NY Times:

Those one-time payments cost Verizon money since it must pay merchant fees to card companies and others. The amount it costs Verizon to accept cards in stores could be less because of quirks in how the card companies set fees. It may also be willing to swallow the costs of accepting cards in its stores in exchange for the opportunity to sell upgrades to people who come in to pay their bills.

Surely, many of the folks who enroll in AutoPay use their bank accounts to make the automatic payments and not their credit cards. That also reduces the costs for Verizon, and I think points to a bigger trend coming down the pipe in the industry.

New services like Dwolla (which I need to cover more in the future) facilitate bank-to-bank payments, going around the credit card companies and the associated fees. Any consumer or merchant wants as few hands as possible on every transaction, because it means fewer costs to do the transaction. That's likely something Verizon is looking at, as well.

Honestly, I don't really mind the new Verizon fee. You can say it's silly, because they don't charge a fee to come into a store and pay your bill (where there are a ton of overheads costs — people, the store, etc.). But the folks who come into the store to pay their bills most of the time wouldn't be paying online, anyway, and forcing them to make that switch by adding in-store fees would result in a bigger backlash than this effort.

What do you think? Is Verizon in the wrong, or is this a legitimate business decision?

I hate paying bills. But who doesn't?

It's so arcane to take a couple hours out of a beautiful day, or a night when you could be sleeping, or otherwise doing something fun or productive, and write a ton of checks and stuff a lot of envelopes and stick a lot of stamps.

Today, you're going to set your bills to pay themselves. And then you're going to spend the time you used to waste writing checks and do something fun instead.

Sounds pretty good, right?

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Today's the day you'll never forget to pay a bill again.

Most of the monthly recurring services you're using likely have a way to sign up for automatic payments where, once a month, on a specified date, money is taken from your bank account and applied to your bill.

You can likely do this for your:

• Mortgage/Rent
• Utilities
• Cable/Internet/Phone/Cell
• Insurance
• Car Payments
• Loans
• Credit Card

You've already set your savings to be transferred automatically; now it's time to do it for your bills.

The Easiest Way to Set up Auto Payments

While there are ways to tell your bank to make payments of a certain amount on a recurring basis, the easiest way to ensure that your bills are being paid precisely is to sign up with your service provider.

Head to the Web site of each of your fixed costs and look for a link that says something to the effect of "Autopay my bill" or "Sign up for automatic payments." Each of your services is likely to say something different, so you may have to do a little sleuthing.

When you're ready to set up the auto payments, have on hand the account information for your main checking/debit account.

Do this for each of your services. It will take a little bit of time, but it's worth it!

3 Reasons to Pay Your Bills Automatically

Having your bills basically pay themselves is one of the most convenient aspects of Automatic Finances. Beyond the convenience, here are three reasons to pay your bills automatically.

• Never Forget Another Bill – When your bills are set up with autopayments, you'll never forget to pay one again. You may have a great memory, but why bother taking the chance that you'll never mess up?
• No More Late Fees – When your bill gets paid on time every month, you'll never get a late fee. Even if you mail your check before the bill is due, what happens if the Post Office loses it? Don't risk paying more for a bill or getting stuck with a fee.
• Save Yourself Time – Your time is valuable. Do you really want to spend it sitting around, sorting through your mail, writing checks and licking envelopes?

Like many other services, your provider may offer you a break if you set up automated payments. Be sure to look for any deals or offers they have when you're signing up.

TIP: Keep track of what day of the month money will be withdrawn for your bills. You want to be sure that you aren't getting hit with every bill all at once, leaving you with little to no money in your main checking account for day-to-day purchases.

Since today's post is about automation again, I can use another picture of a robot. So here's a robot with a frog.

Automating your long-term savings is the key to protecting yourself … from yourself. When you're attacking a long-term goal, it's incredibly easy to procrastinate or convince yourself that something else is more important.

When it comes to retirement investing, automation also has a number of other benefits, which you'll learn about today.

Enjoy.

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Now that your retirement accounts are up and running, it's time to start the investment process – and keep it going.

While any retirement plan you have with your employer will automatically receive contributions directly from your paycheck, you'll need to set up automatic transfers to your other accounts, like your new Roth IRA.

Follow the instructions on your financial institution's Web site to begin your investments and set up automatic contributions, using the amount you have left in your flux account. If you'd like to be investing more – which is great! – make changes to your budget to allow for a higher retirement contribution.

(While we won't suggest an exact investing plan for you, you may be able to get by with as little as two funds. Read Paul B. Farrell's "The Lazy Person's Guide to Investing: A Book for Procrastinators, the Financially Challenged, and Everyone Who Worries About Dealing With Their Money" to find out more.)

How You Benefit From Automating Your Retirement Contributions

When you set your retirement contributions to automatically occur every month, there are a number of benefits, including:

• Dollar Cost Averaging – By spending the same amount of money on your investments every month, you buy less when the market is high and more when the market is low. This is called "dollar cost averaging" because, over time, the cost you spend per share averages out.
• No Temptation to Time the Market – If you're constantly monitoring the markets for the right time to invest your monthly retirement amount, you're playing a loser's game. Let your automated contributions happen on a regular schedule and you won't waste time trying to figure out when to invest.
• Fewer Fees – Some financial institutions will not charge certain fees when you are set up to automatically invest every month. Fees can eat up your savings overtime; whenever you can avoid them, it's worth it.

Why You Should Set It and Forget It

When you're investing for retirement, you're in it for the long term. Despite the up and downs of the stock market on any given day, week or month, you will not be using that money for years.

After you determine what you'll be investing in, and set it to happen on a regular occasion – once every other week, once a month, etc. – don't touch it.

Don't take a loan out against it. Don't pull it all out when the market drops. And don't throw money at it when it's going up. You've got a schedule set with automatic contributions – the last thing you need is to add human error into the mix.

Depending on your level of confidence, you may not want to check your retirement portfolio more than once a quarter or even once a year. Remember, it will go up and it will go down – but you're not using it anytime soon.

Use your judgment to decide how often you can stomach seeing the swings in your account.

TIP: While it can be easy to procrastinate contributing to your retirement, the longer you wait, the less money you'll have. Albert Einstein reportedly called compound interest – the money you make from the interest you earn – "the most powerful force in the universe." The earlier you start investing, the more time you have for compound interest to build your retirements. 

OK, there's not actually any robots involved in today's post, but the image above was too good to pass up.

Now that we've got your accounts open, it's time to put the system in place to automate your success. The beautiful part about this is that once you set it, you can essentially forget it. You don't have to worry about remembering to transfer money into your savings each month … it'll be done automatically.

PS. I haven't plugged purchasing the PDF version of the ebook in a while, but if you want to support this great content, here's the link to get a downloadable copy.

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This is where it gets fun. Today, you're going to set up processes to automatically save for your goals and dreams. And once you get it going, you'll barely ever have to check back in.

Using your online savings account, you can automate savings from your central checking account on a weekly, bi-weekly, or monthly basis.

But before we set it up, let's look at the reasons why automating is so important.

5 Reasons You Should Be Automating Your Savings

• Treat Saving Like a Bill – Instead of waiting until the end of the month to see how much money you have left over, automating your savings treats it like a bill you have to pay. Saving is now a priority; it's not something you try to do when you can.
• Pay Yourself First – The second most important personal finance principle – after spending less than you earn – is to pay yourself first. You'll never build your net worth and reach your goals if you aren't saving, and automating that is crucial to consistent growth.
• Remove the Human Element – When your money moves automatically, you never make the mistake of forgetting to put it aside, transferring the wrong amount, or making a mental excuse for why you can’t save it this month.
• Feel Comfortable – Stop worrying about whether you're saving enough, or if you'll have the cash to put aside this month. When the system is set up to work for you, you can feel comfortable that you're on track to reach your goals.
• Save Time – Your time is valuable. Why not use these tools to spend your time doing the things you love, rather than managing your money?

Thankfully, ING Direct – and pretty much every other online savings account – makes it extremely easy to automatically transfer money into your specific accounts.

How to Automate Your Short-Term Savings

After you've logged in to your ING Direct account, click on the "Transfer Money" tab to get started.

Using your budget calculations from Day 9, enter your monthly savings set-aside into the "Amount" field, with the money moving from your central checking account to your specific goal account.

Choose the recurring frequency, with the transfers happening monthly on a day that you choose.

Select a start date, with a finish date of the specific month you'll reach your savings goal.

Click continue, double-check everything, click accept and … you're done!

Literally. That's all you have to do to automate your savings.

It's so easy, you're probably wondering why you haven't done this before. You've done it now; that's what matters.

If you're going to be saving for more than one short-term goal at a time, repeat the automation process with the money going into its designated fund.

Remember to set up your once-in-a-while fund to be automatically filled. Even though it's not technically a savings account, treat it like one until you need to access the money to pay those bills.

Shouldn't It Be Harder Than This?

Saving your money isn't hard when it's happening automatically – that's the beauty of it.

How often have you worried about whether you're saving enough (or at all)? Have you ever worried about needing money in an emergency?

When you've got the money in the bank – and are growing it monthly without a lift of your finger – those worries disappear. And when the day comes that you need to spend that money, you don't have to worry about having it at all. You've got it.

Now that you've got your short-term savings in place, it's time to move on to your longer-term goals, including retirement. We'll take a look at that tomorrow.

TIP: Don't forget: after you set up your short-term transfers, you should still have money left in your flux account for retirement. If you're down to nothing, you'll need to slow down your short-term savings. Take a few more months for your vacation fund, or save for fewer short-term goals at a time.

I've done it. After some time working to get out of debt, build up an emergency fund and actually get to spend money on wants and not just needs, it's time to celebrate.

I want to celebrate with you. That's why I'm going crazy and giving away my ebook — Automatic Finances: 17 Days to Your Financial Freedom — here on the site.

Here's how this is going to work. 

Over the next two and half weeks, I'm going to post a day's worth of content from the ebook (plus the introduction and two finale chapters) here on the blog. If you like what you've read, you can get yourself a PDF version of the ebook using the "buy now" link to share with your friends. If you don't, you don't have to buy it. (The ebook does have a 100% satisfaction guarantee, so I'd refund your money any way if you didn't like it.)

Let's celebrate successes with even more successes. So here goes … the introduction to Automatic Finances: 17 Days to Your Financial Freedom.

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Do you know where your money is going?

Are you saving enough money for retirement, vacation or education?

Are your bills paying themselves every month?

If you're like most people, you're making mistakes in at least one of these financial areas. Chances are, you're off track in two, if not all three, of them.

But that's okay – it's not too late for you to start automating your finances and getting your money back on track.

Automatic Finances: What You'll Learn How to Do

The Automatic Finances system will teach you how to set yourself up for financial success and spend less time getting there.

Using tools freely available online and a mindset dedicated to reaching your goals, you'll learn how to:

• Track and categorize all your spending
• Find your net worth and watch it grow
• Save money and invest for the future without pinching pennies
• Ensure your money is getting the highest rates of return possible
• Have your bills paid automatically and never write a check again

The system is designed so that in 17 days, you'll be spending less time worrying about your money and more time watching it grow.

What This Isn't: A Get Rich Quick Scheme

Before we go any further, you need to understand one thing about the Automatic Finances system: it isn't a get-rich-quick scheme.

There's nothing to sell. There's nothing to invest in. There's no secret code or handshake that will make cash rain down on you.

The system assumes a number of things about you:

• You have an income, whether it's from a steady 9-5 position, from freelance projects, investment earnings, or as a small business owner
• You care about growing your net worth, paying yourself first and saving for the future
• You want to have more free time to enjoy life, rather than worrying about your money

If that doesn't sound like you, then Automatic Finances isn't right for you. Email us at info@automaticfinances.com and we'll refund your money – no questions asked.

But we're guessing you do want to save more and spend less time worrying about it. You're hard working and want your money to work as hard as you do.

Where Do You Stand Now?

Automatic Finances makes a few assumptions about your knowledge of personal finance; you may not know it all, but you have the desire to learn as much as you can.

The goal here, however, is not to teach you the basics of personal finance. Key lessons like paying yourself first, spending less than you earn, and the ins-and-outs of investing are not the focus. The more comfortable you are making financial decisions, the better the system will work for you.

When you're done with your 17-day journey, you'll be in a better position to make these good habits happen automatically.

A Word on Recommendations

Throughout Automatic Finances: 17 Days to Your Financial Freedom, you will see recommendations for certain products and services, like Yodlee, ING Direct and Vanguard.

While these have proven that they work in conjunction with the system, you are certainly not required to use them. There are a number of equally capable and fully functional alternatives that you may already use or be familiar with.

The Tools: What You Need

In order to make the Automatic Finances system work, you'll need:

• a debit card, linked to a primary checking account
• access to an Internet connection and computer
• an email account
• ability to open online banking and savings accounts

But beyond the actual tools, you'll need to have a certain mental preparedness to keep the system working for you. Most importantly, you'll need to be dedicated to increasing your net worth by paying yourself first, being frugal, and spending less than you earn.

Without these three key habits, no financial system will work for you.

TIP: The Automatic Finances system is a cashless system. Beyond the convenience of using a debit card to pay for most of your expenses, it makes your spending much easier to track.

The biggest appeal of automating your finances is that once you set it, you can basically forget it. Everything works as it's supposed to — your bills are being paid, you're investing through dollar-cost averaging, and your spending is automatically being tracked.

But there are certain times in life when you need to go back to your finances and make sure everything is working the way you want it to.

Here are some times when you should re-automate your finances.

When You Have a Big Life Change

Expecting a baby? Recently laid off from your job? Got a promotion and a big raise?

Life is full of change, and when you have an occasion that greatly affects your financial situation — you need more money, you've got less money coming in, etc. — it's time to make sure your finances are working for the same thing you are.

If you've been laid off and need to horde cash, you may want to stop contributing to your Roth IRA until you're back on your feed. If you've just switched jobs and are going to be making more money, ramp up your savings or investing goals and don't let that extra cash go to waste.

When You've Shifted Your Financial Goals

Ready to throw a lot more money at your mortgage? Need to start saving for retirement? Finished paying off your debts?

The best feeling in the world is when you've finished a financial goal or are starting to focus on a new one. It's at these times you need to re-asses the system you have in place and ensure it's working toward your new goals.

For example, if you've been automatically socking aside money each month for your emergency fund, when you get to your target number, you may want to start boosting your retirement savings or start a new savings account for a short-term goal, like a house downpayment or new car.

This isn't rocket science, but it's worth remembering that your money will only do what it's told, so if you've got a big life change that requires some adjustment, take a look and see if your money needs some new direction.

You don't necessarily need to adjust every aspect of your automatic finances — your bills should still pay themselves and your spending should still be tracked online, for example — but make sure your money is doing what you want it to and that you're working toward the same goals.

If there's anything we can learn from this economy, it's that getting into debt isn't necessary to live the life we need. But if you're used to living a life of credit and debt, how can you ensure you won't get stuck in it again?

By automating your finances, you can prevent yourself from getting into debt. Because once that debt begins to spiral out of control, it can be much harder to hold onto your finances.

When is that Bill Due?

Let's face it — we all lead hectic lives. We're trying to hold together a professional working lifestyle along with active family and social lives, so it's no wonder that our finances can often be the first thing to slip.

It's easy to forget when your bill is due. You know when it's due, but it slips to the back of your mind and, before you know it, you missed the date and you are left with hefty charges and have lost any promotional interest rate with your credit card or loan provider.

If you're not keeping a tight check on your finances, you may have to seek debt advice in the future.

Automatic payments means that you no longer have to worry about remember to pay your credit card debt, unsecured loan repayments or store card bills. As long as the money is in your linked account, the bill will be paid.

Tip: Many credit providers only let you set up a direct debit for the minimum payment. If you are looking to clear your debt much quicker then you might want to set up a standing order as well.

Dealing with Unexpected Financial Expenses

Automatic payments let you put money aside for a those unexpected expenses, using a once-in-a-while fund.

Car costs, essential household maintenance or a financially expensive month will put someone struggling financially on the brink of bankruptcy.

Your debt problems can be resolved by effective budgeting and automating as much as possible. You will never realize how much you spend on gasoline or food shopping until you see it in full.

By taking full control of your own finances, you'll understand the true cost of everyday expenses on your income.

Use a Debit Card for Your Purchases

Many personal finance tips say you should only use cash, but dare to be different! As long as you have control over you budget and won't be tempted to spend any more than you can afford, put everything you spend on your debit card.

With a debit card, you'll have a full log of your spending through online banking and don't have to worry about keeping receipts.

You may also find that purchasing everything with your debit card makes it easier to say no to those little treats (morning latte, vending machine nibbles, glossy magazines) because smaller outlets do not take card payments.

Remember, you are in control of your finances. If you are in debt, seek debt help. Don't put off until tomorrow what you can do today. By automating your finances, you can keep yourself out of debt and get a better grip on your money.

Nobody's perfect, right? I'm not, you're not — and we'd be kidding ourselves to think if we were.

And when it comes to money, we tend to make decisions emotionally instead of rationally, often becoming our own worst financial enemy.

But it doesn't have to be that way. You know that, and I know that.

Unfortunately, sometimes you have to make the mistakes in order to figure out how to do things right.

Fortunately for you, I've done these. So you can learn from my mistakes and avoid making them yourself. And thanks to financial automation, you'll never have to worry about making them (and neither will I).

1. I forgot to make a credit card payment.
   Since I rarely use my credit card (and pay it off in full every month), I completely forgot about the bill sitting in the stack of mail. It had one charge on it, and I didn't pay it that month. I didn't even pay the minimum. Now, I autopay my bills, so I don't have to worry about forgetting to make payments.
2. I never sent in the check for my cable bill.
   This time, I remembered to write the check to pay the cable bill, but instead of dropping the envelope into the mailbox, I lost it in my car. A month or so later, after I checked out my account online and saw the bill hadn't been paid, I found the envelope under the driver's seat. Oops.
3. I wasn't prepared for once-in-a-while expenses.
   No one likes getting a big bill in the mail that they aren't prepared for. It's even worse when you could have prepared for it. I didn't set the money aside for a car insurance payment, even though I knew it was coming, and had to scrounge for the money. Now I have an automatically filled once-in-a-while fund, so the money is always available when the bill comes.
4. A paycheck sat in my wallet uncashed.
   There's nothing more useless than a check made out to you sitting in your wallet, and not in your bank account. When you're carrying around the check, it can't earn any interest in a high-yield checking or savings account or be used to pay your bills. If you have direct deposit, your money is immediately available to be used or saved.
5. I forgot to track my spending.
   It's easy to procrastinate gathering all of your receipts, sitting down with a pencil and paper budget, and calculating your spending. But now that I use a debit card for all of my spending, I can see where my money is going online, either through my bank's site or via my account aggregator.

Take it from me – mistakes happen, but it's best if you can avoid them. Financial automation does the job.

Want to find out more about automating your finances? Download the first three days of Automatic Finances: 17 Days to Your Financial Freedom absolutely free!

When it comes to managing your financial success, there's no one more qualified to make decisions than you. (Yes, not even many fund managers.)

But even though it's up to you to plan out and execute your financial goals, you may be getting in the way of your own success.

Let me share a story with you.

In the Beginning, There Was Ameriprise

When I first started saving for retirement, it was with Ameriprise — the investing/insurance arm of American Express. The only way I knew them was from a free lunch a co-worker of mine invited me to.

I had a great opportunity to start investing for retirement early (I was still pretty young), and wanted to get going, despite not really knowing how it all worked.

As we began to save and invest, I learned more. I read a ton of personal finance books and started automating my finances.

After a bit of learning, I knew that our investments would be better if I managed them myself, using index funds at Vanguard. But I was worried about moving our Roth IRAs — afraid that I couldn't handle them and would screw something up.

So I procrastinated. I waited. I extended the process. I even blogged about it, hoping to get my worry out there.

I came up with a ton of reasons to put off making the move. The process was too long. I had questions about Vanguard's Web site. There would be fees for moving my money.

I didn't want to make the move. But I knew I should.

Finally, of course, I did it. I can't calculate the amount of money I may have lost during my time procrastinating the move, but there's a good chance I did lose some.

It was my fault. And it could have been avoided — if I hadn't stood in the way.

To Overcome Your Inaction, Set a Goal and Automate

The goal of Automatic Finances is to remove that human element as much as possible from the money management process.

There's a reason you should pay yourself first and give every penny a purpose: the less you take a wait-and-see approach to saving, the lower the chance you'll either over- or under-manage your finances and make poor decisions.

• When you automate your savings, you'll always have money to pay yourself first.
• When you automate your investing, you'll never be tempted to time the market.
• When you automate your billpay, you'll never procrastinate paying a bill.

Stop hindering your own success. Set your goal and then make it automatic.

You can either be your biggest asset or your own savings enemy. Which are you?

We often talk about financial automation as a convenience. Instead of having to remember to pay your bills before their due dates, they'll get paid automatically.

But for some bills, there's actually a financial incentive to automating your payments.

While some service providers (like Sprint) may give you a one-time credit for automatic payments and online invoicing, you might be able to save a lot more cash on longer-term loans.

Shaving Interest off of Student Loans

When I graduated from college, I had a pretty fat student loan debt. It's not anything to write home about, but I'm still paying it off.

About 9 months after I graduated, I consolidated my loans with the Department of Education's Direct Loan Servicing Program. As part of the re-payment process, you have the option to enroll in the Electronic Debiting Account (EDA) repayment method.

Like with all autopayment services, the provider wants to ensure that they're getting paid every month, on-time and in full.

So, in order to get more people to enroll, they offer a quarter point discount (.25%) on the loan's interest rate. Instead of a 5.375% APR, it's down to 5.125%.

The second bonus comes from making the first 12 payments on-time — an easy thing to do when you're in an autopayment program.

What's Your Debt Reduction Story?

Next week, I'll be hosting the Carnival of Debt Reduction, sharing your stories about paying off your debt.

If you've got a great story, submit it to the carnival now.