Paying Your Bills on Time — Every Time!

Step One: What’s the Damage?

This is a lot easier with a budget (and if you don’t have one, why not make one now?), but go ahead and compile all of your bills as they come in. You can just stash each bill statement in a folder or in an area on a desk, or written out on a piece of paper, or on your computer. If you have a good idea of what the bill will be each month, you don’t even have to wait until you get your statements to do this step. If you’re splitting with roommates or a significant other, go ahead and write down the calculations for each person (Divide the total amount due by the number of people that are paying the bill equally, eg: 1000/4.)

Step Two: What’s Left?
Now that we know how much you owe each month, divide that by 4 to get how much your bills will cost each week.That’s how much you’ll put away each week to pay your bills. Discouraged? Depending on how much money you make each week, that’s how much you’ll have left over to pay for other variables (such as the debt repayments, excess groceries, gifts, hair cuts, etc.) plus savings. So if you make 200 per week, you’ll only have 40 left over for that. 300, you’ll have 140 left over.

Step Three: It’s Pay (everyone else) day!

Now every payday, immediately take your check or cash (after depositing) and use that money to pay your bills or put aside immediately in preparation to pay your bills. Prewrite your checks or schedule online payments so you don’t forget to pay them – and remember, don’t touch that money! One technique I use is the following:

  • Money set aside for bill payments go in checking account, which is used to pay bills online immediately on payday.
  • Money left over for other uses is kept in cash. Gas and grocery money can also go in an envelope so you know how much money to spend on gas or groceries for the week.
  • Any extra money goes over to my savings account. Try to save at minimum 10% of what you earn for emergencies.
Another Technique
Another method to paying your bills is to go on a purely weekly basis instead.
  • Every payday, check out what bills you have to pay for the week ahead. Let’s imagine you got paid $300 and your electric bill is coming up on Wednesday.
  • Immediately write a check or schedule the payment online to pay that bill.
  • Immediately minus that amount from your checkbook or other method of keeping track of how much money you have in your account, or keep the rest as cash.
  • Next payday, see what bill is coming up and repeat the process.
  • For large payments, such as mortgage or rent bills, you should use the weekly method by dividing the payment by 4 and keeping that amount saved where you won’t be tempted to spend it until the payment is due.
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