Now that you have good financial goals and a budget, you need to develop some good habits for managing your money. Here are some of my recommendations for successfully working your financial plan.
Pay all bills the day the money arrives. It is important when planning your budget to consider due dates and make sure you are meeting those deadlines. Paying your bills on time saves you a lot of money in late fees. And you always run the risk of bouncing checks if you pay bills before your income is deposited.
Consider using direct deposit. If your employer does not require it (and more and more are requiring it), ask your employer about directly depositing your paycheck into your bank account. Normally, the funds arrive at your bank earlier than you could to deposit the account, and many banks now offer free checking if you have direct deposit. It is easy, convenient, and you have access to your money faster.
Have all the bills in one place, ready to pay when the time comes. Keeping the bills organized and together is important and makes bill paying easier
Consider paying bills online. More and more financial institutions are offering free online bill paying. This can be very convenient and saves you the cost of a stamp. You can also program in automatic payments on those fixed expenses saving you time each month.
Grocery shop once a week or every two weeks. Going to the store less frequently and with a well planned grocery list will save you lots of money. Also, a little planning ahead will avoid the need to run out for very expensive fast food.
Consider "level payment plans" on heating/cooling expenses each monthto avoid large bills due at one time. Most utility companies and agencies offer level payment plans which can help immensely with budgeting.
Set up an "envelope system" to help you track where your money goes. Label each envelope with a specific spending category such as housing, food, transportation, clothing, entertainment, personal care, and credit/loan payments. At the beginning of each month, put the money you have budgeted into the appropriate envelopes. When payments are due, withdraw the amount needed. This strategy, even if only employed for a few months, can help you really see where your money is going and how to better manage it.
With a little planning and by following some basic important financial principles, families can do a much better job managing their money each month and putting savings away for planned expenses and for emergencies.