Return to Transcripts main page

American Morning

How Can We Stretch Our Dollars in the New Year?

Aired December 27, 2001 - 09:41   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MILES O'BRIEN, CNN ANCHOR: Now to a big question a lot of us ask ourselves as we approach January 1st, how can we stretch our dollars in the new year? Terry Savage is a personal financial columnist for "The Chicago Sun-Times" and the author of the savage truth on money. She joins us from Chicago now with some ideas.

Terry, you left Miami, you went north?

TERRY SAVAGE, "CHICAGO SUN-TIMES": No, I'm still in Florida. I'm smarter than that. It's too cold in Chicago for the next week or so, Miles.

O'BRIEN: I was given some bad information. I apologize. Anyway, that's good, you've got a lot of wisdom there.

I'm gathering because you've got "Quicken" and "Microsoft Money" over your shoulder, we are going to talk about paying bills online, tracking finances online. I've been doing this for years and years. It's the greatest. How many people are doing it? Do we know yet? Is it really getting to the point where it's getting some serious market penetration?

SAVAGE: Yes, it's gaining momentum. I can pay my bills right from down here if I just log onto a computer, and that's what's so neat. I'm not just talking about banking online, which is going up, and checking balances to see if you're overdrawn. I'm talking about paying bills. You know, the most thankless and time-consuming task is writing checks. So about every bank has now set up online banking, where you have your account, they'll help you do it. It's really relatively inexpensive.

At Bank One, it's $4.95 a month for unlimited. Fleet Bank has it. Bank of America. Every bank will let you set up to pay bills right from their Web site. It's so easy, and so inexpensive and so safe. Portals, like here, MSN Money, pays bills online. You can is sign up for the bill-payment service there, Yahoo! finance. You know that more than 400 billers ranging from Macy's and Bloomingdale's to your credit card companies and utilities allow you to pay bills online.

The biggest one, U.S. Postal Service -- this is surprising -- they have a really sophisticated online bill pay service. You get three months free, and then I think it's $6.95 a month for 20 bills. The most astounding thing about this is you can pay just anyone, not just your major credit companies, but if you owe your sister-in-law money from that shopping trip, you can send a check to anyone. It's very easy to do, and I'll talk to you in a minute about how safe and secure it is.

But let me take you to another level. Yes, you saw "Microsoft Money" and "Quicken." They're the to two popular personal finance softwares, and they have come out with new programs for 2002. And you can track everything about your personal finances, all of your accounts. You can see your spending with the click after mouse. So you not only do your bill paying, but you actually write checks, right on line, check all your accounts, take a look at your spending.

This makes it so easy. You give every single check a category. Yes, you can still write paper checks. You can do it at your bank's Web site and download it into your "Quicken" or "Microsoft Money," which helps you at tax time. This should be your New Year's resolution, to start bill paying online. It's really fantastic.

The next thing coming up is online bill presentation. Now at all those bank Web sites, you can elect to have your bills presented there, no more bills in the mail.

And the U.S. Postal Service System has got the absolute latest thing. They will e-mail you. In your regular e-mail, you can set up a special e-mail account. This charge account bill is here. You can look at the bill itself and click to pay it securely right through your e-mail system.

So this is the way to do the bills for the new year.

O'BRIEN: And I assume that perhaps there's a generational divide here; younger people are doing this more than older folks, safe to say?

SAVAGE: Absolutely not. What we find is -- and I've been talking about this for years and doing it as you have -- the people who have the time, people who are sitting around at home, and that includes a lot of older people -- or those who have a lot of assets and they want to watch them because those personal finance softwares give you a way it look at all of your investment accounts and your credit card accounts as well, everyone is doing it. Now I want to insure you that it is safe. First of all, your bank stands behind every single transaction. So there cannot be fraud that costs you any money. It's secure. Have you a pin number.

Think about the times you call up at midnight and order from a catalog. You are giving your credit card information from a stranger and home address and phone number. Banking online is secure, it's safe, it's guaranteed by your bank, it's inexpensive and in some cases it's free for the first three months. It makes it easier for to you stay organized. I know I sound like a commercial for it, but you have done it. Once have you tried it, very rarely will you write a paper check. But you can. When you download information into your computer, it will come through as a check and you insert the payee name. O'BRIEN: All right, you are preaching to the choir in this corner, but hopefully folks will listen up and try. It works for me, too.

All right, Terry Savage, we appreciate that.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com