One of the fastest ways to increase your credit score is to pay all of your bills on time. But, a lot of us don’t pay them on the due date thanks, not to lack of funds, but because of laziness and an unorganized life. Unfortunately, disorganization is no excuse when late payments are added to your credit report or you are assessed fees and penalties for not paying your bills on time. But, you can set up a system so you are well-organized that can make your payments for you so both you and your creditors win.
Review your Budget. Account for your expenses each and every month. Dave Ramsey says that every single dollar you make sure have an earmark or a duty description before it even reaches your bank account. You should have a written budget every month, and you should review it at the end of the month to see if you need ot make changes for the next month. Did you overspend in a certain category? Did you forget to allocate money for a certain activity? Review your budget and make the appropriate adjustments. Make sure that the money you have on hand can cover all your expenses on paper before you start spending money on carefree activities. One great way to do this is to use budget software available on the Internet. I recently joined Mint.com and am very impressed with its services so far. That way, you will have a better idea how you are spending your money and where it is going throughout the month.
Put Your Bills In One Spot. For bills you receive by snail mail, make sure you designate a certain spot for them. My mother used to collect the bills in a large ledger book, and she would sit down once a month and write checks out to all of the companies who sent bills. She had a system and did the same routine every month. Put your bills in a file near your computer or where you write checks. Once you send in the payment, shred your bills to guard against identity theft. To reduce paper, you can also scan hard copies of bills and put them into a file on your computer. Or, better yet, sign up for online statements and online bill paying.
Make Payments Immediately. Don’t delay the inevitable. When you receive a bill, whether it is by electronic means or through the postal service, make sure that you pay it immediately. One technique is to write your check as soon as the bill comes in. The only bill my wife and I receive on paper in the mail is the water bill. Our county has not gone to online bill pay yet. So, the day the bill reaches our mailbox is the day that I write the check.
Make It Automatic. It is even better if you can automate all your bills so they are electronically paid directly from your bank account. It took me years to feel comfortable in doing this. But, after more and more late fees from all the credit cards I used to have as a college student, I got fed up and started using my bank’s free online bill paying service. And, now I have not looked back since. I love the service. It is incredible. Take advantage of the technology. It will save you a lot of money and time in the long run. It will keep you paying your bills on time and will save you from dings on your credit report and a late fees.
To become disciplined and stay on top of your bill paying, you must be organized. If you have fallen behind on payments or feel overwhelmed when it comes to your finances, take some time to regroup. Set up a budget and manage your bills so you have the upper hand. Use technology to your advantage. There is no excuse to being unorganized in your finances when you have so much riding on your success.
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