Learning financial responsibility is an important part of growing up and becoming an adult. We all have had those times when we just shopped or spent money until it was gone. But then you have to look at yourself in the mirror and wonder why you did it and why you put yourself in such a bad spot.
So you decide to really make an effort to create a budget and live within it. At first it can feel odd to be notating every dime that you spend but you will quickly learn that having a budget is one of the most important ways to avoid late fees.
No one wants to give money away for no good reason and late fees are no different. They are the adult equivalent of detention because you didn’t complete your homework.
The Beauty of a Budget
Having a budget means that you know what all of your expenses are and also all of the money that you will have coming to you. You also know when your bills are due so that you can schedule accordingly and pay them slightly early or right on time. An added bonus is that you will never again need to worry or wonder if you will have the money to pay a certain bill because it is in your budget and accounted for. All of this and basically all of your budget information is just another name for your financial planning. With careful planning, you will never be late on another bill and you will never have to waste your hard earned money on late fees.
Automatic Payments are the Best!
Having a budget is a great first step, but there are times when you get really busy and you just forget to look at your budget for a week or two. That is not good. That is how checks don’t get written and mailed on time. But life can get busy and you know that. So take the next step and create automatic payments for as many of your bills as you can. Any bill that is recurring and the same amount each month is very simple to set up through bill pay on your banking website. And some companies offer an auto pay feature so that they debit the payment from your bank account each month on a specific day. These are both great ways to make sure that a busy week, month or life does not stop you from paying your bills on time. These features are also great for months when you are on vacation, traveling for work or just super busy with other events. And again, you can have confidence that your bank account will have the money in it to auto pay your bills because you are relying on your budget to guide your spending.
Set Your Own Due Dates
If you are worried that you will forget to write a check or process an electronic payment on time, you can create your own fail safe. On your budget, you will want to move the real due date of your bills up a few days to be sure that you have the time to get the payment set up. So instead of paying your rent by the 5th of each month, get into the habit of paying it on the 1st of each month. With those few extra days, you can have the confidence of knowing that you will get everything paid on time.
Alerts and Reminders are Great Tools
Before you had a budget, bill reminders and alerts from your lenders might have seemed like nagging. But now that you are living a financially responsible life you can appreciate those little reminders. Use them as a second warning or reminder system. You already have your budget reminding you when bills are due, and you have as many bills as you can set up on auto pay systems but let the bill alerts remind you yet again. This is a good time to go check your bank website or the lender’s website to make sure that your payment is setup to process and that there haven’t been any unexpected errors. It is just one more reminder to help yourself save money and avoid late fees.
Create A Process For Mailing Checks
Nothing is worse than putting in the time and effort to create a budget only to make a silly mistake and still get charged late fees. This can easily happen if you write a check only to find that you are out of stamps. You put the envelope on the desk and then forget about it for a week. Now the check is late. You had planned to get stamps the next day but you forgot. To eliminate this issue you need a system to be sure that each time a check is written it is mailed. One way is to buy a book of stamps on the first of each month at the grocery store. Another way is to email yourself so that you see it the next day and remember to buy stamps. You also might want to create a special place to put outgoing mail such as payments. Try to locate them someplace that you are certain to see when you leave the house such as on a clip on the back of the door or sticking out of your wallet so that you have to pull them out to put your wallet in your pocket. No one ever wants to make their payments late but it can and does happen. To avoid late fees you simply need to create a process that you repeat each month in the exact same manner. Once you remove the opportunities for errors you will find that you are no longer making those same mistakes over and over and you are also not wasting money on late payment fees. Financial responsibility is a skill that can be learned by anyone who is willing to make the effort and wants to save money.