Perhaps the reason why my budget method makes sense is because of how few things I have to take care of. Those primary 7 bills are broken into 2 credit cards, 2 student loans, a car payment, rent and phone bill. The amounts are pretty much the same month after month. Overly simplistic, I know.
Back when I first decided to make a real budget and not just a list of things, I wanted peace of mind and simplicity, in that order. I had been charged plenty of overdraft fees and had to pay for some late fees that weren't quite mine. So I labored and labored on many 2x2 post-it notes about how I could make this work, and came up with what I still think has been one of my best ideas. I had the idea of splitting the 7 items right down the middle and paying everything right on that date I got my paycheck. Zero-out my account every payday. No more than 2-3 days a month to pay bills.
Not everything fit nicely, but after shifting things around, I ended up with:
-1st paycheck of the month: car payment, both student loans and both credit cards, plus food/personal/gas allowance.
-2nd paycheck: rent, cellphone, savings/misc dues plus allowance and additional savings amount.
The result is either a zero balance or a bit leftover, but it does bring me great peace to know that these things are all in order, instead of waiting for due dates to come by and having to think about paying accounts more than once every 2 weeks.
I write down my payday dates on a notebook I always carry, and below them, write all the things that are due. I make them in advance too, and write any notes of changes or things I expect to see that would be different. This works for me.What works for you? Do you pay bills as they're due, or do you use your own schedule?
I do our bills much the same as yours. Each payday I pay 1/2 the bills the second payday the other 1/2. Sitting down 2 times a month to pay bills seems to work in our house as well
ReplyDeleteGood, glad I wasnt the only one! I just think it makes so much sense this way.
Deletei actually just read dave ramsey "total money makeover" and I have started his steps towards living a debt free life. I definitely suggest it if your are interested in adding more tips your process.
ReplyDeleteI havent read his book yet (shame on me!), but I've heard enough about him around the blogosphere to know him quite well and his methods! I totally base a lot of my budgetting on his 7 steps. But now that you mention it, perhaps I should actually READ the actual book!
DeleteOur bills are paid as they come in. By the end of the month rent, ins, etc... Is saved & ready to be paid for the next month as well.
ReplyDeleteNice! Being a month ahead is awesome. I am hoping I can do that at some point.
DeleteI'm glad you found a system that works for you. My "system" is named Fred. He handles all the bills and money. Seriously, we could be dirt poor or filthy rich but I have no idea! Not cool, huh?
ReplyDeletem.
I thought you'd say that. Could we borrow Fred for a few?
DeleteSince I have cash reserves sitting around, I just pay them as they come in...or I wait and pay everything that came in during any given week on Friday. This works well since payday is always Friday here. Save up the week's bills until Friday, check that th direct deposit went through, then I pay them.
ReplyDeleteAlso have a list each month of what bills need paying and as I take care of them, I check them off the list. That way if a bill doesn't arrive in the mail due to an untoward event, I know to contact the creditor proactively and get a copy sent or take care of it electronically. No sense in just waiting on a bill that you KNOW is due and ending up it being paid late and it costing you extra fees/late charges.
That's the funny thing... I don't even check when they come in or not. Since all of them are online, I just go by my own schedule. Sometimes I find I'm TOO early (like it just happened with my SL2) and I had to wait another two days before they posted.
Delete