When it comes to maintaining good credit, it’s extremely important to make sure you pay bills on time. While missed payments usually don’t start affecting your credit until they are more than 30 days late, they often have an immediate impact on your wallet, in the form of late fees and higher interest rates. Why not skip the potential damage to your credit report and those late fees by paying those bills on time, every time?
Getting organized and maximizing your cash flow is just one way to make sure you are making timely payments.
Set It, (Don’t) Forget It & Negotiate It
If remembering to pay your bills is a challenge, setting up automatic payments removes the issue of having to remember to make the payment every month. Many of your creditors, from utility companies to mortgage lenders, allow you to set up automatic payments. You might want to create automatic payments for your fixed expenses, such as your mortgage, any subscriptions, and student loan payments, and then pay variable bills manually, to avoid any surprises that can occur if a variable bill is considerably higher than usual one month.
If you find that your variable expenses (like utility bills) are fluctuating greatly and having a negative impact on your monthly cash flow, you may be able to get the cost down by negotiating the fee. Services like cable, mobile plans, etc. are often more negotiable than you think! By reducing your expenses, you are more likely to pay bills on time.
Make Your Due Dates Work for You
Suppose that your student loan bill is due on the 7th of the month, your credit card bill on the 25th, and your utility bills are due on the 15th? Keeping track of a variety of different due dates can make it difficult to remember what bill is due when and to make sure you pay bills on time. One way to simplify your bills and learn how to pay bills on time is to work with the companies to change the date each bill is due so they line up with each other and make paying them more streamlined for you.
Many companies, from federal student loan service providers to cell phone providers, will happily work with you and switch the date your bill is due. That way, you can schedule your due dates around the dates you get paid. For example, if you get paid on the 1st day of the month and the 15th of the month, you can schedule half of your bills to be due the 1st or 2nd and the remaining half to be due the 15th or 16th.
Tackle Bills Right Away
Another way to make sure you don’t forget to pay your bills is to pay them as you receive them. If you still receive paper bills and pay by check, write out the check for the amount due and put it in the envelope right away. If you receive e-bills or pay electronically, schedule the payment as soon as your statement arrives. With bill pay, it is simple to schedule the payment for the future if you don’t have the funds in your account to cover it right away. By taking a few moments to pay the bill as you receive it, or set up the payment, you ensure that you will pay bills on time since there won’t be a payment to remember later in the month.
Consider Credit Counseling
Working with a nonprofit credit counseling agency can not only help you pay bills on time, but also make the process a lot easier. If you have more unsecured debt than you can comfortably manage on your own, a debt management plan allows you to make a single payment to a credit counseling agency each month. The agency then distributes the money to your enrolled creditors on time, so that you avoid fees and high interest rates. A benefit to debt management through a credit counselor is that creditors typically grant benefits such as lowered interest rates and waived fees to help you pay back what you owe faster and more efficiently.
If you’re struggling to pay bills on time, CESI can help. So far, we’ve helped more than a million people take control of their financial lives. We’ll work with you to help you learn how to pay on time and to create a plan that works best for you.
Consumer Education Services, Inc. empowers people to overcome their financial challenges and lead financially-healthy lives.
CESI is NOT A LOAN COMPANY