While it might seem easier said than done to pay your bills on time, the honest truth is that late fees are brutal. Most companies can charge anywhere from $5 to $20 per month for late payments. Credit cards charge even more than that when you pay late.
For a person in the habit of paying final notices on bills, this can increase your monthly bills by several hundred dollars. That can amount to a month’s worth of groceries, a car payment, or a generous clothing budget.
Catching up on your bills may not be easy — especially if you are chronically behind — but with a few months of sacrifice, you could get your payments on track and increase the amount of money you can spend on yourself.
Here are 3 tips you can use to start paying your bills on time…
#1 Pay your past-due amount plus some.
If you are paying your bills when you get final notices, then you are essentially one month behind on your bills.
The simplest way to catch up is to pay the company more than your past-due amount. So, if your electric bill has $100 past due and another $100 due in 12 days, then you should try to pay $125 to begin to get yourself out of the past-due cycle.
If you do this for 4 weeks in a row, then you will be paying your bills on time in the matter of a few short months.
#2 Pay up one bill at a time.
If you are a month behind on several bills, then start with your smallest bill and pay all of the money due — both past due and currently due. Next month, move to the next largest bill and pay all of the money due on that one. If a monthly bill is too large for you to pay off all at once, then pay half of it one month and half of it the next month.
#3 Stop discretionary spending for a short time.
To pay up your past-due bills, you may have to decrease (or stop) your discretionary spending for a few months. This may seem like a huge sacrifice, but if you make this sacrifice today, then you will have even more discretionary funds in a few short months.
I have been a certified tightwad since I became pregnant with my first child and decided to find a way to stay home with him. I enjoy sharing my experiences in my journey back to financial health and planning for a future — which will include sending 2 kids to college and early retirement.