Bills are an unfortunate part of all of our lives, and can sometimes be hard to keep track of. However, missing a payment comes with consequences (like pricey late fees and penalties, not to mention potentially damaging your credit rating). Learning the best way to keep track of bills is essential for your financial health!
If you’re like most people, you have multiple expenses that need to be paid each month. Whether it’s an internet bill, mortgage payment or student loan installment, staying organized and on top of these due dates is critical.
If you’re juggling multiple bills and struggling to remember due dates, finding the best way to keep track of bills for your own financial situation can make a huge difference. With late payments come fees and penalties that can add up, not to mention the possibility of dinging your credit score / credit rating or potentially over-drafting your bank account if you weren’t prepared.
Organization is key!
When our family started working towards paying off our debt, one of the biggest pieces and the first step we took was organizing our bills and finding the best way to keep track of bills for our family. Sitting down and creating a monthly budget, taking a look at our monthly bills and tracking our paydown plan for debt was a huge piece in our success when it came to our financial goals.
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The Best Way to Keep Track of Bills
Most people have a single checking account and a single savings account. However, if you’re looking for the best way to organize your money, there’s a better way!
One of the easier things you can do when it comes to keeping track of your bills and staying on budget is opening more than one checking account.
Our family actually has four checking accounts:
Checking Account #1 is used for our major household (like our mortgage, electric bill, gas bill and other utilities)
Checking Account #2 is a joint account we both put money into for family expenses throughout the month (like the grocery store and gas)
Checking Account #3 is specifically funded by the money I make and want to have fun with
Checking Account #4 is specifically funded by the money my husband makes and wants to have fun with
If you only have one checking account, this might seem like overkill to you, but I promise there’s a reason behind it!
When we started working on our plan to pull our family out of debt, we realized that we needed to stop using our credit cards and pay for as much as possible with cash (or debit card). By keeping the majority of our cash in the first 2 checking accounts, which were in turn ONLY used to pay bills that are for family bill payments, we ensured that we weren’t spending money on other things.
We also made the decision to have separate individual checking accounts so that we could put a little “fun money” aside to do whatever we each want to do with it. Keyword here is little! The main goal is to put as much towards debt paydown and savings.
Finally, we also created separate savings accounts for items we knew we would need to purchase down the road, like a new water heater or to go towards a future family vacation. This allowed us to keep that money separate and not have to dip into our main savings account.
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How to Keep Track of When Bills are Due
Tracking your spending with a budget is good way to know how much money you have to spend each month. However, one of the biggest challenges many people face even when they’re great with a budget is how to keep track of when bills are due. If you have multiple monthly bills that require separate payments, staying organized is paramount for making sure everything is paid on time! Here are 5 easy steps for how to keep track of bills and due dates.
Step #1: Keep your bills in a specific spot.
No matter how your bills arrive- in the mail, in your email, or signing in each month to manually check them – keeping them all in one place will save you a headache at the end of each month when you’re scrambling to find your upcoming bills.
For paper bills, a good idea is to use an organizer like this one, or an “inbox” like this that you can keep on your desk or countertop. It allows you to organize your paperwork in one easy to find space. At the end of the month you know exactly where to look for each financial institution or retailer’s bill!
Online bills that come to your email inbox can sometimes be easy to miss. When it comes to organizing these paperless bills, try setting up a specific folder for them all to be funneled into in your email account.
Then you can also organize your inbox with folders by year or month. After you pay your online bills, you can also add your e-receipt to these corresponding folders too to make it easy to find in case you need to reference it.
In this area you can also keep and organize your monthly statements from each financial institution, making it easy to double check that your payments go through online or are received in the mail.
Step #2: Organize all of your bills, due dates and amounts due
Organization is key to staying on top of when your bills are due and avoiding late fees. Make a list of every single bill you have to pay each month, when they are due and the amount that is due.
Some of these items might stay the same each month (like your mortgage payment), while others will vary. Having a list makes it easy to double check those variable amounts as you go to pay your bills, and not let one slip through the cracks.
Step #3: Choose a specific day and place for paying bills each month.
It doesn’t matter so much where you pay your bills each month, but that you are staying consistent. Having a dedicated bill pay area in your house can help!
In this area you can keep your paper bills, stamps, checkbook, envelopes and anything else you might need to pay your bills, as well as your budgeting materials. Next you need to decide how often you need to sit down and pay them.
I recommend sitting down in this area once a week to update your weekly budgeting sheets. If you only track your budget and spending once a month, you miss having control over your money. This is also a great way to stay on top of irregular expenses.
For bills that are due throughout the month, consider adding a bill pay time for each pay period. Paying your bills with each paycheck as your money comes in is a helpful way to get ahead of bills without worrying about having to pay a giant chunk once a month.
This also allows for you to prioritize paying your bill before spending your money on non-necessities.
If it works for you, you can also choose to pay your bills once a month. As many bills are due only once a month, you can use this time to not only pay the items that have upcoming due dates, but to schedule out other payments using online bill pay or autopay.
Step #4: Use a Bill Pay Calendar
Earlier you organized all of your bills into one area to make it easy to reference. Use this as a bill pay calendar so that you don’t miss a pay date!
Organize your bills on this list by due date each month. Once you pay a bill, simply highlight or cross out the item to indicate it’s paid. This way you have a visual reminder of each outstanding bill, and can quickly see if you have forgotten to pay something. You can also incorporate your favorite budgeting app, expense tracker apps or personal finance app into this!
Simple, easy and effective, right?
Step #5: Set up bill reminders
While monthly payment trackers are a great organization tool, for many people it’s not enough to help them simply REMEMBER to pay the bill in the first place.
I recommend setting up easy bill pay reminders in your phone calendar or email calendar! For bills that are due on the same date each month, it’s easy to set up a recurring bill pay reminder for a few days before that due date.
Don’t forget about those irregular bills, like a yearly HOA payment, property taxes or membership! Be sure to add these to your calendar in advance.
This easy tool can help you stay on top of your bills better, and avoid accidentally forgetting a bill because you didn’t check your bill tracker.
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Bill Pay Methods to Keep Track Of
When it comes to the best way to keep track of bills and make sure they are paid on time each month, one of the most important pieces is to keep track of the different ways you plan on paying your bills. You’ll want to first choose your payment method, and there are a few different options to choose from. No matter what payment method you choose, be sure you note this on your bill pay calendar tracker!
1. Auto Bill Pay
Auto-bill pay is one of the easiest ways to make sure your bills are paid on time every both. There are also companies that will offer you a discount for choosing to pay your bills with automatic payments.
While this is my #1 recommendation for the best way to keep track of bills and make sure they are paid on time, it only works if you are diligent with tracking your money. Otherwise, you might forget about an auto-pay and overdraft your account.
2. Online Bill Pay
Online bill pay is my next favorite way to make sure you pay your bills on time. Like auto-pay, you can schedule payment dates for future days. There’s no need to worry about tracking down stamps, or worrying that your check gets lost in the mail. Plus, many have a mobile app make it so easy to make a payment (or log on to check your account balance).
Plus, with online bill pay you also receive an email receipt automatically upon payment, which you can keep for your records just in case you need to show proof of payment in the future.
3. Pay by Mail or In Person
If needed, you can mail in payment for bills to the majority of companies out there. Many local companies (like utilities) also accept in-person payments.
Find Best Way to Keep Track of Bills For Your Family to Stay On Top of Your Finances
Keeping on top of your bills and expenses is incredibly important not only for making sure things are paid on time, but also for helping to stay healthy financially. Remember, the above methods and best practices are different things that work for different individuals. Experiment and find out what works best for your own financial situation.
Let me know in the comments which what you personally use to keep track of bills! If you enjoyed this article, please also take a minute to share with your network so it can help others, too.