I figure at some point in this I should guide you through something useful, (hence the name) so why not start today.
I am bringing you some financial advice that I have followed for the last several years and it has done me a lot of good.
This advice works for any type of pay schedule but works best if you are paid weekly or every two weeks.
I have almost always had jobs that paid every two weeks so I will use that as my example.
I set my bank up to automatically send checks out the Monday or Tuesday after I get paid but where I differ from most people is I pay every single bill every two weeks.
Now I don’t pay the whole thing twice a month or anything, I pay half plus. (those who get paid weekly would pay quarter plus)
What I mean by half plus is say I have a bill that is $100, I will pay $55 every two weeks.
The reason I do this is because it is NEVER a bad idea to be ahead on your bills just in case something happens and you have to cancel a payment or two. You certainly feel the hit a little less if you are $60 ahead on the $100 bill.
I do the same thing with the electric bill which really helps during the summer months when most people use far more electricity than they do during the winter, if you build up enough throughout the winter in credit, you never have to worry about spikes in the summer.
Something else that is very nice about this method is if you move, you can recoup some of the moving costs which is very nice. For example, in March 2015 I moved back to Missouri from North Dakota. I had been paying all my bills half plus for the entire previous year and never had to pay attention to the bills when they came in because I knew everything was covered, but when I moved, I had to get hold of all the companies (mainly electric and my dentist) to get them to cut me checks for the credit owed to me. Just between those two I had about $1500 in credit ($800 electric, $700 dental) and it was just through paying more than my bills and I hadn’t paid the electric bill for 2 or 3 months.
But to be fair, I do a little more than +$5 on electricity due to fluctuation. Set bills are much easier to predict. If you average your electricity bill as close to what you pay during the summer, say during the winter if your bill is $50 and during the summer it is $100, pay $75-80 every month… the summer should be a breeze.
The reason I had overpaid my dentist was because my dental insurance was a finite amount I could use throughout the year and I didn’t want to have to try to come up with money if some big expense came up as it had been years since I had been to the dentist.
This is something that isn’t the easiest thing to start but you will not regret it if something happens and normally you would fall behind.
My favorite benefit of this is back before I used this method, I lived my life like most people with two short weeks where i had to pinch pennies because all the bills were due and two good weeks because I had money to spend. Paying everything half plus makes every week pretty stable, you always have a little money to spend rather than having a big chunk which makes it easier to blow your budget.
I guess that is it, try this out and let me know how it works out for you in a few months. If your bank doesn’t offer automatic bill pay, get a new bank. Your time is worth so much more than losing your mind trying to pay bills all month.