Are you having a hard time getting a handle on your bills? You are not alone. Paying your bills on time is the single most important factor when determining your FICO credit score, so I am here to help you set up a one-time solution to tackle those bill due dates. In my experience, late fees are generated due to forgotten payments, and not because of negative income. When you are a busy full-time working mom, bill organization is key to having a more peaceful life. For me, juggling a full-time job, my blog business, my son, my husband, yard work and everything in between, I will quickly forget about something important if there is not a system in place for me to remember it. Your financial world, including your bills, are no exception. You might remember to pay some bills on time, but there is always a chance for one to slip through the cracks. Let's stop this from happening right now! Below, I am going to give you a step-by-step guide on organizing your bills.
MAKE A DETAILED LIST
This is the step that requires the most work. If you have never organized your bills, this step takes a little investigation. Write down every bill that you must pay on a monthly basis, and put them in order of due date. On this detailed list, I would also like you to write the amount due for every bill. If there is no due date, you can leave it blank. The purpose of this step is to find out exactly what bills you have. I do realize, that some bills such as car insurance, and property taxes are due either annually or semi-annually. Don't worry; we will not forget to include these. Make sure you add them to your list as well!
DECIDE ON A PAY SCHEDULE
As I have I have mentioned before in an earlier post; I am a huge fan of paying your bills based on your paycheck. You can see my post on why I choose to be a paycheck-to-paycheck budgeter here: Why I Budget Paycheck-to-Paycheck. Not everyone is me, and I totally understand this. So I will explain both – paying your bills according to your paychecks and paying them once a month.
Paying Your Bills According To Your Paychecks: If you choose to pay your bills on this schedule, I want you to organize your bills to match your paychecks. Looking at your due dates on your bill list that you have created from Step #1, decide what bills must be paid using the first paycheck, and what bills need to be paid using the second paycheck. Here is a great visual to make this easier to understand. I referenced this visual in my post Why I Budget Paycheck-to-Paycheck, but it is an excellent way to find out what bills you need to pay with what paycheck. Once you get paid, pay these bills immediately. The most important thing to remember on this step is not to procrastinate. Pay your bills on payday, and have peace of mind they are taken care of.
Paying Your Bills Once A Month: Some people can not afford to pay their bills using last months income, and that's ok. If you want to pay your bills on the first of every month, I highly suggest calling your bill carriers and asking them to change your bill due dates. Some companies are happy to do this, and some companies are not so willing. It never hurts to place the phone call. For example, if you get paid on the first of the month, and want all of your bills to be paid on payday, simply call your bill carriers and ask that they change the due date from the 20th to the 5th. I will always recommend you change your due date to at least five days after you get paid. This will give you some leeway for holidays or weekends.
Just because we have paid our bills, does not mean it necessarily happened. This is usually the case when people use auto-pay. Never assume a bill has been paid until you actually verify that it left your bank account. Let me give you an example of something that happened to me.
My husband and I have a sewer utility bill. I called our city billing department and set us up on auto pay. Our sewer bill was set up to come out of our checking account on the 26th of every month. I called them and set this up in January. In March of the following year, I received a past due notice from the city telling me I was three months behind on my sewer bill. I almost wet my pants! I never monitored my checking account closely, only looking at it a couple of times a month, and I failed to realize that my sewer bill stopped drafting in December of the year I set up auto pay. I immediately called the city billing department and explained that I set up our sewer bill to come out every month on the 26th. The representative told me that auto-pay with the city needs to be renewed every year, and if I didn't renew it, it simply stops drafting from my checking account. If I would have had a system in place for my bills, I could have easily avoided the late fees on my sewer bill. My mistake was that I relied too much on auto-pay, and not enough on my responsibility to monitor my bills.
Having a written system is something I like to use. Even though I am only 30 years old, I am old school when it comes to pen and paper organization. I like to have the physical paper in front of my face when I organize my finances. Since everyone is not like me, and the world seems to be so dependent on electronics, some programs will help you with organizing your bills.
I have used such programs such as Mint.com, and for some reason, I always resort back to pen and paper. Some programs that are worth mentioning, Mint.com being one of them. The cool thing about Mint.com is that it will actually send you an email or text alert when your bill is due. The only problem I see with this is that you might get that alert, but if you simply acknowledge the email or text message, and don't pay the bill right when you get the alert, there is a good chance you will forget to pay it.
MoneyStream.com is a program I like to recommend. You simply add your checking account credentials into their website, which uses bank-level security. Once they can see your spending in your checking account, it will pick out all the recurring bills, and organize them on a calendar. On this calendar, you can see all of your bills at a glance. You can see the progress of all bills, whether they are paid or not paid. Here are some of the cool features of MoneyStream.com:
- It allows you to see what's coming up, not just bills that need to be paid this month
- If you link your biller's account into MoneyStream, they will automatically update your bill amount or due date if anything changes
- By seeing your income and bills on one calendar, you can easily determine how much money you have left at any given time
- It will alert you of anything unusual
- Receive text and/or email alerts for upcoming bills.
Whether you choose to go old school like me or use a program like MoneyStream.com, getting a handle on your bills is the most important thing. Simplify your busy mom life, and organize your bills. I will tell you first hand how freeing it feels to know that all of my bills have been paid, and I no longer have to worry about them. Take the stress out of the equation, and out of your life. Download my free Bill Checklist Binder!
CLICK HERE TO DOWNLOAD MY FREE BILL PAYMENT WORKSHEETS!