We all have our own monthly obligations and expenses we must consider each month. Many of our expenses are mandatory while others are by choice. We need to pay our mortgage each month. The electricity bill. Mobile phone. Insurance. Car payment. These are just a few of the monthly bills we have to pay but when we add in additional discretionary spending, especially just after the holidays when we might have spent more than we had planned, making monthly payment on time can be a bit confusing even overbearing at times. At other times of the year, expenses are more easily handled and bills paid on time when discretionary spending is lower. Yet keeping track of all these bills and making sure there are no payments made after the due dates can be a challenge sometimes. Here are a few tips to keep you on track.
This is the most convenient way to make sure your payments are made on the due dates. Remember, even though credit reports only show late payments when they’re made more than 30 days past the due date, the creditor can charge additional fees and even increase your interest rate if you pay beyond the grace period. Setting up auto-pay is the simplest way to make sure you’re on time, every time. In fact, some creditors will give you a reduced interest rate if you do establish an auto-pay arrangement.
Creditors can send you reminders a few days before your payment is due and remind you yet again if you haven’t made or scheduled a payment. With all the electronic messaging these days and multi-tasking, an isolated payment date can be missed. These reminders can be sent to your mobile phone as well as your email.
Beyond setting up an auto-pay arrangement, when you receive your statement, set up a scheduled payment that will make sure your payment is made on or before the due date but you can also coincide with your pay day. Paying your bills on the 1st or the 15th of each month gets you into a routine which makes it harder to forget and your payments will always be on time.
Do you know why creditors always have a place on their website asking if you’d like to receive your statements electronically? It not only saves them time and money but it accelerates their cash flow as well. Creditors know the sooner you receive a bill the greater the likelihood not only will the payment be made on time but there’s a tendency for borrowers to pay a little early. Forget the mailed statement and sign up for electronic delivery.
Set aside a little money each month before any bills are paid. It can be a certain percentage each month, say five or 10 percent, just make sure you set up a little financial cushion for those unexpected expenses. It’s the discretionary spending that can throw us off track. When you find you’re over budget for the month, you’ll have some extra cash to cover the payment.
Staying on top of monthly payments simply means changing the traditional methods of paying bills. Online bill-pay really hasn’t been around all that long compared to traditional statements coming through the mail so it can require some adjustment. But once the routine is set, it’s a habit and a good one and leaves you with more time to do the things you want to do. And not worry about paying the bills on time.
Questions or concerns? Click below to chat with a home loan expert now!