I was reading my feed reader today, and I came across this post over at Get Rich Slowly. I can’t tell you how much I disagree with it. I was surprised when my first response was oh hell no – usually I don’t get that worked up over someone else’s opinion. Now everyone is entitled to their opinion, and now I need to share mine.
So here’s how I do it. I don’t pay bills as they come in. When I first moved in with my husband in the late 90’s, my method for paying bills was something along the lines of, “Oh shit, I think that bill is due this week!” It didn’t take long (thank goodness) for me to realize that I needed a better plan.
My method now is pretty simple. Once a week on Sunday nights, I hop online. I spend about a 1/2 hour catching up my checkbook, and then open Google Calendar. In there I have every recurring bill listed exactly one week before it’s due. I look at all the bills that have been marked on the calendar since the previous Friday, and pay everything, right then, until the next Friday.
It works like this:
A bill that is due Thursday, February 18th, is marked to be paid on Thursday, February 11th. Since I pay all bills on Sunday, I’ll pay that bill on Sunday, February 7th. It’s not paid the second I get the bill, but it is paid well in advance, each and every month. I can’t recall the last time I had a late fee on anything. If money is tight, I have a little extra time to do a money transfer as well.
Here’s why this works for me:
- It takes about 20 minutes to pay my bills.
- It’s a regular Sunday thing, and after ten years is now routine.
- I know that since I’m paying things that aren’t due for a week, nothing will be late.
- If I can’t get online to a particular site, I still have a week to pay – plus I keep all the payment envelopes in case I have to mail something in (3 postal days in transit).
I can’t imagine taking a few minutes every time a bill comes in to pay it. First, that would mean writing a check without completely knowing the status of my checking account – that’s bad. Second, I would have to find five minutes to concentrate with a 4 and 7 year old in the house – not easy, not in my house. And third, what’s the point? Paying bills is not something I want to spend five minutes doing. It’s not something I like spending 20 minutes doing. But by doing it all at once, it ensures I’m in the bill paying mindset. I’m concentrating on numbers, not on what my kid is about to watch on television, or whether someone’s pulling knives out of the drawers in the kitchen.
Now if taking a few minutes every time a bill comes in to pay it works for you, great. The ultimate goal is to get things paid on time, and without any late fees. But if the thought of that just completely overwhelms you, take thirty minutes to collect all your bills and set them up as recurring events in Google Calendar. Keep an eye on things closely for the first month or so, and when you’re sure all your bills are set up correctly, you’re all set. Sit down once a week and get things done, not seven times a week to do a half job of it.
We don’t have cable right now, and while I realize how much I really miss it just after I get back from doing laundry at my parents’ house, I’m so glad we don’t. Because when the kids come with me to do laundry, I hear one thing for the entire trip.
