I’d like to share a method that works well for me on how I go about paying my bills. It does require some discipline but I feel it’s well worth it in the end if you struggle with a tight budget. I tend to feel less stressed when I use this method and I hope it will help others as it does me. This approach works even better if you have an interest bearing checking or savings account and credit cards with some type of rewards bonus attached to it.

Ok, so most of the people I know of tend to pay their bills right when they actually get the bill or wait till the day before the due date to pay it. *raises hand* Yeah, that used to be me too until it got to be too difficult to come up with a large sum of money all at once right at the end of the month. I thought of a way that would make it more simpler for myself.

I will give you an example for a long-term bill like car insurance..

Ok so if you chose the pay every 6 months option, good for you! In the long run you pay less as most insurance companies will discount the premium if done this way. Ok, so you’ve scrambled to pay your last premium and now you figure don’t worry about the next payment for the next 6 months. I think a better approach would be to start saving up for it now. If your premium is $500 and you get paid weekly, put $20 ($500/6months=$83/mo / 4 weeks = $20/wk avg) of your paycheck into an interest-bearing checking or savings account. When it’s time to pay, you’ll have it ready and then some extra since some months have 5 Fridays.

I find this much easier. Use the same concept with all of your bills and believe me your life will be a lot easier. Yes, it will require discipline, but remember the first time is always the hardest – after that it gets easier and easier to do. You’re less tempted to use the money that you will need later when it’s not sitting in front of you.