Day 25: Simplify Bill Paying and Budgeting

Bill paying and budgeting are areas where simplifying can have an immediate positive impact on your stress level. By simplifying your accounts and setting up a regular budget and bill paying strategy, you can know where your money is going and find ways to keep more of it.

• Keep all your bills together in one place. As soon as you get your mail, sort through it, separating your bills from all of your other mail and placing them in one spot all together so when you’re ready to pay bills, you know where to find them.
• Use online billpay instead of writing and mailing checks. The time it takes for the payment to be applied to your account is reduced, and you can save on checks and stamps. I prefer to do all my online bill paying in one place, from my bank’s web site, so I can see all payments on one screen, as opposed to going to each company’s website individually to pay bills. Paying bills now only takes me a few minutes each week.
• If you haven’t done it already, think about going paperless. Instead of receiving bills in the mail, you’ll get emailed statement notifications that allow you to log in to your accounts and see your statement online. To keep a record of statements, open the electronic version when it becomes available and save it as a PDF file on your computer. 
• Create a monthly spending plan, either on paper or electronically. I prefer Mint.com, a free service that lets me consolidate all my financial accounts in one place to review, and I can set up budgets that Mint automatically tracks and categorizes for me. Mint can also send you bill reminder alerts and can alert you if you’re going over budget in an category. Having a spending plan in advance helps you spend your money with more purpose and less “oops, where did all my money go?!” I highly recommend checking out Dave Ramsey’s books and website for more information on how to set up a budget.
• Consolidate accounts as much as possible. Roll over IRAs and 401Ks from previous employers into investment accounts in one financial institution, which makes it easy to keep track of them. Likewise, consolidate checking and savings accounts if you have several in different banks. Consolidate credit cards down to just one or two (or even better, get rid of the credit cards completely!)
• Make savings automatic. If you use online banking, you can usually set up automatic transfers between your own accounts, and that makes it easy to transfer money from your checking account to your savings account. Set up an auto transfer to regularly transfer money to savings, such as on each payday. Some banks, such as Bank of America, offer to “round up” your debit card transactions each day and transfer the change into savings automatically. These tools take the thought out of saving and can grow your bank account much faster with little effort on your part.

This post is part of the Fresh Start Series, 31 days of tips and tricks to simplify in the new year.