And when you understand your remaining budget for food, entertainment, leisure and holidays, you’ll give yourself a bit more mental space to look for discounts and cashback and make that budget stretch even further.
One of the first things to organise is your recurring payments. A recurring payment is any type that’s set up and taken at regular intervals. This could be your monthly phone bill or your monthly Netflix subscription, your utility bills or your council tax payment instalments.
A recurring payment could be a standing order, a direct debit or a recurring card payment. Recurring card payments give a business permission to take money from a preauthorised debit or credit card at regular intervals. Examples of this are your Netflix and Amazon Prime or Disney+ subscriptions.
With a direct debit, you authorise a business - such as a mortgage provider or utility company - to collect a payment from your bank account on a specific date.
The third way of collecting recurring payments is through standing orders. These work very similarly to a Direct Debit, pulling funds from one account to another on a pre-agreed basis. The main difference between a Direct Debit and a Standing Order is that you set up the arrangement with your bank. If you change your mind, it’s normally relatively easy to change the standing order.
In this article, we’ll start with a standing order definition, before explaining how to set one up and amend it, and reviewing some standing order advantages and disadvantages. We’ll then look at alternatives to standing orders. If you’re a visual person, you might not like the traditional banking ‘ledger system’ (basically those lines and lines of transactions) and we’ll highlight how HyperJar makes life easier for you, while giving you the option to schedule payments for things on your terms.
What is the definition of a standing order?
A standing order is a pre-authorised payment instruction given by a bank account holder to their bank. It specifies a fixed amount of money to be transferred to a designated recipient at regular intervals, usually weekly, monthly, or annually. The bank account holder - that’s you - maintains control over the payment amount, date, and recipient. The benefit of this scheduling is that you can tailor it to suit your needs - you might want to time the payment to leave your account shortly after payday for example. Once a standing order is set up, it won’t change - unless you make those changes yourself.
How do I set up a standing order?
There are three ways to set up a standing order: online banking, app banking or in branch.
Before you do any of the three, you’ll need the following information:
Recipient's account details: Account number, sort code, and account name.
Payment amount: The fixed amount to be transferred.
Payment date: The date of the first payment.
Payment frequency: How often you want the payment to be made (e.g., monthly, weekly).
If you prefer to do your banking face to face, just explain what you’d like to do when you arrive at the branch and they’ll help
When you bank online you can simply log in to your account, navigate to the payments and transfers tab and look for the recurring payments or standing orders option. Follow the on-screen instructions to input the recipient's details, payment amount, frequency, and start date.
App banking is similar to online banking. You’ll need to look for the payments tab again and enter the same details as above.
Can I change when standing order payments are taken?
Ideally, you want to make sure standing order payments are timed for when there’s guaranteed to be money in your account. If the money comes out of your account after you’ve just been paid, you’re less likely to default on the payment than if it comes out towards the end of the month when you’ve still got a weekly shop to pay for or just had to shell out for a birthday present.
You might also want to time the payment based on the recipient needing it by a specific date. Perhaps you pay your childminder at the end of the month to cover the month ahead. In that case, you’d want to schedule it a couple of days before payment is due, so around the 28th. Occasionally, it takes time for the payment to clear your bank and the recipient's bank. Also, payments will be delayed by weekends and bank holidays.
One of the advantages of a standing order is that it’s easy to amend, and you can easily do this online or in an app. Navigate to the payments tab, select manage payments and then standing orders.
It’s also very easy to do in a branch or with telephone banking. You might need the recipient's bank details to hand as well as a clear idea of when you want the money to be transferred.
Why is it worth setting up a standing order?
Let’s look at some standing order advantages and disadvantages:
Standing order advantages
Convenience: Set and forget regular payments, saving you time and effort.
Healthy habits: Automate saving for future expenses.
Control: You set the amount and frequency of payments.
Budgeting: Helps to manage your finances by setting aside specific amounts for recurring bills.
Avoid late fees: Reduces the risk of missing payments and incurring penalties.
Free of charge: Typically no fees associated with setting up or using standing orders.
Standing order disadvantages
No payment confirmation: You won't receive a notification when the payment is processed.
Manual process: A bit more admin for you compared to direct debits.
Not suitable for variable amounts: Best for fixed recurring payments. You can’t pay £100 one month and £120 another. It has to be the same amount each time.
How to make scheduled payments with HyperJar
Standing orders, by definition, may help you keep your finances in order, but they are designed for people who like to read their bank statement like a ledger.
If you prefer to see your finances in different Jars, HyperJar lets you set up automatic transfers from your main account to your Jars. These Jars can be linked to your HyperJar card so that recurring card payments can be collected from these Jars.
You can automate scheduled payments into any of your Jars, or to any of your contacts who also have a HyperJar account. For example, if you have kids cards paired to your account you can automate pocket money payments into their jars. If they have their own phone, they will be notified that money has gone into their account and they will be able to see it visually in their HyperJar app, or on your app if they’re not yet ready for their own device. If you’re saving for Christmas, schedule £20 to go into your Christmas Jar on the first of every month. You can choose how much and how often to pay - and change it any time.
If you share Jars with flatmates or with a partner, you might also want to schedule a payment into a joint bills jar, or save up for a holiday. Rather than one person taking responsibility for everything, HyperJar allows several users to join a Jar and pay in and spend from it together. That way nobody is out of pocket if others don’t pay their contribution on time. You can even send messages in the app to remind people a payment is due and everyone can see when something gets paid. The Jars give your pounds a purpose and help you visualise your spending so that you can account for all your recurring payments and see what’s left afterwards.
Want to read more about automated payments and saving for important things:
How to set up and cancel a direct debit
What is the 50 30 20 budgeting rule and how to do it
Get your HyperJar debit card now
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