I would like to get a consensus here. Who pays all of their bills (including rent/mortgage) on the same day of the month versus spreading out over the course of the month? (Ex. paying rent/mortgage on the first and the remaining bills on the 15th). I imagine this has a lot to do with paycheck cycles and I can see the convenience of the former but there are advantages to the latter from a cashflow perspective for those who may be living paycheck-to-paycheck.
We pay the credit card once/month and pay it off in full, the cc has on it the everyday purchases, gas, any eating out, groceries, insurances, comcast, and insurances. The remainder-utilities & phone are paid by my husband-he keeps track of & pays online, which is something I refuse to do. This system gives structure to expenses and we are not caught off guard with panic to pay something where we may have missed a date, resulting in fees associated with the overlook. The cc due date offers a solid solution that works well.
We pay throughout the month. And if we have anything on the credit card when we get paid, I pay off any balances. So, usually 3x a month, we have a budget that shows what bills need to be paid and at what times.
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I use the “paycheck budget” method. I have my paychecks listed by date on a spreadsheet (I love Excel spreadsheets!) and all my bills listed according to the day of the month they are due including rent and savings. I set up automatic transfers to savings accounts for various items including rent and I schedule my bank bill pay for the day my check hits the bank. I like it clean, neat, and done. Whatever is left in my checking account is mine to spend until the next paycheck hits. I was never successful doing mental accounting to remember that $X in the checking account was for Y bill, etc. This method saves me mental energy between paychecks.
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I use the Budget by Paycheck method as well. I pay as far ahead as I can, but I budget my entire check (including savings). I take out cash to spend throughout the pay period, and when that is gone, i’m done spending till the next paycheck…
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This is an interesting question! It’s fascinating to see how we all approach it.
Generally, I pay everything around the same time. Most of my bills I put on my credit card and that bill cycle comes in at the same time each month. For bills that are not on the CC, I have scheduled auto-payments to happen around the same time too. It just helps me mentally keep track!
We pay everything on the first of the month. Now that Social Security pays by birthday month, we get our social security near the end of the month, fourth Wednesday. Then on the first of the month, we get our pension direct deposits. So that is the total income for the month.
We have all of our bills, except the gas company paid by our credit card to get the cashback and then pay it in full on the 1st. We know the amount due by then so we put our savings right into the account on the 1st and only keep out our grocery and misc budgeted amount in the checking account. For some reason, I just can’t put the groceries on a credit card even though I know it will get me more cashback. Maybe some day.
These are great responses. I like what you said @ginah about automatic transfers for the must-pay items. For myself, it would of course be simpler to pay everything at once but I find it too painful for the two weeks after paying everything and my cash flow becomes significantly constrained. So I end up just paying rent on the 1st and then student loans + all other bills on the 16th. This gives me a more predictable cash flow throughout the month. And as much as I love the convenience of autopay for certain bills, it is outweighed by my disgust for NSF fees.
triplea87 posted:
These are great responses. I like what you said @ginah about automatic transfers for the must-pay items. For myself, it would of course be simpler to pay everything at once but I find it too painful for the two weeks after paying everything and my cash flow becomes significantly constrained. So I end up just paying rent on the 1st and then student loans + all other bills on the 16th. This gives me a more predictable cash flow throughout the month. And as much as I love the convenience of autopay for certain bills, it is outweighed by my disgust for NSF fees.
@triplea87 I’m confused by your mention of NSF fees. Maybe I didn’t explain my system clearly. I get paid weekly and I transfer a portion of my rent payment to a savings account. (I also did this when I was paid every 2 weeks.) Moving my rent money out of my main checking account made sure that I didn’t spend that money and it was available when I needed to pay my rent on the 1st. The automatic transfers to savings accounts are the few $ I set aside to save up for: Pet bills, Car bills/renewal fees, Insurance premiums, and a Fun account for vacation. My bills are paid from the paycheck that happens before their due date. This system leaves me cash in my checking account to spend however I wish (predictable and smooth cash flow throughout the month), and guarantees all bills are paid on time and the money for a bill isn’t accidentally spent. 
Ah yes, sorry…I should have been more clear. I understand your system and I think it’s very effective. I was referring to @maryann’s autopay methods for bills that are not on CC. While I like the convenience of autopay in theory, it has caused me too many NSF fees in the past.
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got’cha!
I pay my bills, other than my rent, which includes water, gas, garbage and electric in one payment, by when they show up on my email alerts. Sometimes I schedule the payment closer to when the due date is, but I ALWAYS deduct this on my check record when I do, so no worries about NSF. I paid off all my credit card debt in the last few years, and now have just one large balance I am paying down monthly.
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Since all four of my retirement accounts are paid between the 1st and 4th of each month, I pay everything in one day. I look forward to doing my budget! It’s a mix of auto drafts, payments on line and good old paper checks. Since I know how much I will get for the next year, I write up my annual budget each December, for the upcoming year. This includes savings and putting money back into my retirement accounts. When I was working, I’d get paid biweekly. I used all checks back then, so I would do calculations on a paper printing calculator, and attach it to my check book register. That way I knew what was due and I wouldn’t spend it on something else. Once all the bills are paid, I sleep much better at night. I balance my accounts everyday, once the payment clears the credit union account, I adjust my spreadsheet to balance my accounts to the penny.
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There are some bills which I pay annually. Water, gas and electric. My Grandmother taught me this. How I began, I’d pay one month, plus half of the next month and just kept building it up until I was paying a years worth of payments. Then I’d save up and each January, I write a check for 12 months service. I’ve lived in the same house for years, so I know how much each bill will be. I get statements that say “credit do not pay” and how much credit I have.
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I would think spreading out the payments based upon when income rolls in would be best. However, as I think about it, if you have your budget really nailed down, it shouldn’t matter. I think this is mostly an emotional/psychological choice. Know what comes in and what goes out, but pay the bills in whatever way gives you greater peace I suppose.
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Oh… I see what you are saying. I don’t do ANY autopay stuff like that. It takes more time when I pay bills, but I am always afraid that a paycheck will be a couple days off or something and all of a sudden, I’ll have an NSF. So nope… none of those for us.
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I get paid the 1st and the 15th plus I make tips. So I try to pay everything with my first paycheck. Then my second check pays rent and any bills that fall on the 1st. After everything is covered the money goes in a savings account. I’ve been paying off things when I get a big chunk of money saved.
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I spread my monthly bill payments over the month and time each payment to be sent thru online banking anywhere from 7 to 4 days before the payment is due.
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Michael Metzger posted:
I would think spreading out the payments based upon when income rolls in would be best. However, as I think about it, if you have your budget really nailed down, it shouldn’t matter. I think this is mostly an emotional/psychological choice. Know what comes in and what goes out, but pay the bills in whatever way gives you greater peace I suppose.
I know the amount of each bill within a few cents each month. But I do know my income to the penny. I do all my budget the first four days of the month. Even though the largest check comes in on the first, I wait until the fourth and do them in one day. I do forecast the entire year, then fine tune it the last week of prior month. Then I sit down and in under two hours everything is done. I sleep so much better when I know all the expenses are covered and there is something in savings and my “mad money” about $20 that I can spend on a soda or a treat. Something about being able to offer someone out for coffee and a chat makes me “wealthy.” Even if you don’t like budgets, just knowing you have an idea of how much money you have and how much it costs to live, that’s the first step to adult financial responsibility.
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Whatever works for you. I pay all bills on the first (except one that comes in later) and I’m done now that we’re retired. When we got paid weekly, it was a weekly plan. I like this better.
