Check your Direct Debits
What is direct debit?
Direct debits were designed to be convenient for the consumer (in that it means that they do not have to do anything to make regular monthly payments as they are automatic) and for the supplier (as they receive their money automatically without chasing. However, on many occasions such convenience actually costs the consumer unnecessarily.
So why is this? - Well it's simple, when you are actually using the service for which the direct debit is set up for all is well and good. However, the problem arises when you do not need the service anymore. In this case many people assume that the direct debit automatically terminates but the fact is that it doesn't and unless you actually tell your bank to cancel the direct debit payments will continue to be taken each month.
Good examples are:
- gym memberships
- car insurance (where you change provider but keep on paying the old company)
So what do you need to do?
Every month you should review a list of your direct debits (which your bank can give you or you can most probably access if you use internet banking) and tick off the ones that need to be live. If you find any that should not be there, cancel them immediately.