Paying Bills the day you get them

[DISPUTER]

My wife shared with me this system when we got married and it works great for us. I wish I had used it in my younger days. It works really well.

 

Basically, the day the bill hits the mailbox, we pay it. We don't wait until it is "due". I write the check that night and it is in the mail the next day. This may not seem like much of a tip but it has worked wonders for us. This is also beneficial if you ever do need a few extra days, you have them. Think how many times you have bought something you didn't need because you had the extra money. If you would have paid your bills early, you wouldn't have had the extra money to make the stupid purchase.

 

We also contribute up to our employer match in our 401k and then every month, and our deposit into our IRAs is automatically deducted.

 

I try to keep my checking account balance to an amount that will just pay the bills with no "extra money". We have a money market account as our "emergency fund". We pay for everything we can with our credit card and pay the balance when the statement comes. This will really help you gauge how much you are spending and where. For instance, we learned we were eating out too much so we cut back the next month to our budgeted amount. Just make sure you are paying off the credit card every month.

[ZeRo_C0oL]

Great way to manage money... It seems so simple, almost common sense, but it works.

[CactusWill]

Its exactly what I do. And even with all that cushion there will be close calls, when a statement never gets delivered etc.

[Athena53]

I don't like paying bills the day they come in- it's a matter of principle. Even though most bills are monthly, somehow you have only 2 weeks to pay them by the time you get the bill. (And sometimes, such as with cable, you're paying for NEXT month's service.)

 

Most of my bills are e-bills so I get an e-mail. As soon as that happens I set it up to be paid from my checking account at an appropriate date, and I don't delete the e-mail till I do that. I also enter the amount in the Excel spreadsheet that I have instead of a checkbook. I do the same with paper bills- don't throw them out till payment is set up.

 

My mortgage is the only one I have set up as a recurring automatic payment.

 

Whatever keeps you organized is good.

[HoldenMcGroin]

I figure out how much I will need for bills and split it in two. I get paid every two weeks, so the first week I will deduct half of the bill amount from my checkbook register. Then when I get paid again, I add it back in and pay the bills.

 

I set aside how much I'll need for living expenses for two weeks and leave that in the checking account. Everything else goes into savings. Even though I pay for most of my things with a credit card to get rewards, I still deduct purchases from my checkbook register so I don't go out of control with spending. But if expenses are more than I expected, I can use the cc and have a buffer so I can just take money out of the next check to compensate for the overflow.

[angeleyeskkhr]

We do something similar. Basically we pay the bills as soon as the money hits the checking account. This typically means that bills are paid about 2-3 days after the statement cuts (but before I get them in the mail). There's a couple odd-balls that don't get paid that early, simply because the due dates are different.

[Annuit CÅ“ptis]

I don't like paying bills the day they come in- it's a matter of principle. Even though most bills are monthly, somehow you have only 2 weeks to pay them by the time you get the bill. (And sometimes, such as with cable, you're paying for NEXT month's service.)

 

Most of my bills are e-bills so I get an e-mail. As soon as that happens I set it up to be paid from my checking account at an appropriate date, and I don't delete the e-mail till I do that. I also enter the amount in the Excel spreadsheet that I have instead of a checkbook. I do the same with paper bills- don't throw them out till payment is set up.

 

My mortgage is the only one I have set up as a recurring automatic payment.

 

Whatever keeps you organized is good.

I agree, I'm not giving them my interest!

[Nummerkins]

I go about this another way. I have almost everything close on or around the same date each month. At that point, everything must be paid within 15 days. Much easier than having a random stream of bills.

[KYBOSH]

Here's my system:

Day bills on the day they are DUE.

 

 

Honestly, the only problem I have ever had with paying bills in not having the $$$ to do so.

[drew3918]

Here's my system:

Day bills on the day they are DUE.

 

 

Honestly, the only problem I have ever had with paying bills in not having the $$$ to do so.

 

 

That system works, plus you get to Float the credit cards $$$$$$$$$$ for extra days

[Jen23514]

That system works, plus you get to Float the credit cards $$$$$$$$$$ for extra days

 

by paying a bill 10-14 days early would lose me such a minimal amount of interest out of the checking account I pay bills out of, to me, it's almost a non-issue

[hegemony]

credit cards that do not have online payment options I'll drop in the mail a day or two after receiving the statement (e.g., JCB, first hawaiin bank, etc).

[InsultComicDog]

I do not PAY bills the day I receive them but using Bill Pay I SCHEDULE bills for future payment on the day I receive them.

 

Usually I schedule them to be paid on my last pay day prior to the due date. That way money is coming in and going out only a couple of times a month.

[squirrelgirl]

I schedule bills the day I get them. I always schedule the payment to post at least a few days before the due date.

 

Only thing I pay the same day I get the bill is the water bill... and that is only because I can't actually schedule the payment in advance and I'd forget

[Cleaning_Credit]

I have the due dates for credit cards and mortgage on my online calendar. It gives me a reminder 10 days before their due. I pay everything that I can online a few days before their due. Some utilities have to be paid by regular mail. Those are taken cared of by DW.

[BBQ123]

TERRIBLE way to manage money. If a bill comes Jan 1 and is due Jan 25... you should keep your money in the bank as long as possible so YOU get the interest. Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

[hegemony]

TERRIBLE way to manage money. If a bill comes Jan 1 and is due Jan 25... you should keep your money in the bank as long as possible so YOU get the interest. Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

I barely have any money in my checking account. and a .25% APY two weeks is not time much to earn...

[Cleaning_Credit]

TERRIBLE way to manage money. If a bill comes Jan 1 and is due Jan 25... you should keep your money in the bank as long as possible so YOU get the interest. Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

I barely have any money in my checking account. and a .25% APY two weeks is not time much to earn...

 

But multiply that by the number of credit card bills you have x 12 months... year after year... it can turn into something.

[angeleyeskkhr]

TERRIBLE way to manage money. If a bill comes Jan 1 and is due Jan 25... you should keep your money in the bank as long as possible so YOU get the interest. Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

 

I'd rather lose the two weeks' interest than think I already paid the bills and use the money for something else, and not have any money on the 25th to pay that bill.

 

ETA: I dont' think I get interest on my checking account anyway.

Edited January 3, 2008 by angeleyeskkhr

[hegemony]

TERRIBLE way to manage money. If a bill comes Jan 1 and is due Jan 25... you should keep your money in the bank as long as possible so YOU get the interest. Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

I barely have any money in my checking account. and a .25% APY two weeks is not time much to earn...

 

But multiply that by the number of credit card bills you have x 12 months... year after year... it can turn into something.

 

not much...and it would be taxed at >30%

[radi8]

Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

Let's assume I'm paying $1K worth of bills every month, 2 weeks early.

If I left that money in a savings account paying 4.5% instead, over the course of a year, that's equivalent to 24 weeks of additional interest:

 

$1000 X 4.5% = $45.00

$45/ 52 weeks = $0.87 weekly interest

$0.87 X 24 = $20.88

 

So I'm losing $20.88. Fair enough. One "late" fee could easily wipe that out. I'm more comfy paying the twenty bucks a year and having my bills paid early.

[hegemony]

Paying it in Jan. 2 means you lose out on a good 2 weeks of interest.

 

Let's assume I'm paying $1K worth of bills every month, 2 weeks early.

If I left that money in a savings account paying 4.5% instead, over the course of a year, that's equivalent to 24 weeks of additional interest:

 

$1000 X 4.5% = $45.00

$45/ 52 weeks = $0.87 weekly interest

$0.87 X 24 = $20.88

 

So I'm losing $20.88. Fair enough. One "late" fee could easily wipe that out. I'm more comfy paying the twenty bucks a year and having my bills paid early.

 

I waste more than $20.88 every time I fart.

[EasyRhino]

I do not PAY bills the day I receive them but using Bill Pay I SCHEDULE bills for future payment on the day I receive them.

 

That's exactly what I do, it's necessary just to keep on top of all the bills.

 

I usually schedule payments just a few days before due date. It leaves me enough time to fix something, if I'm really on top of things.

[saladdin69]

What is this "check" thing I am reading about?

 

saladdin

[BBQ123]

With HYS you can earn way more inteerst