Every month, we get a bunch of bills to pay such as the rent, credit card balance, utilities, cellphone service, and so on. When on the road, it's really easy to miss paying those bills on time. We generally lose track of what day it is and our mind is really not into remembering if we paid this or that. This second post of four is dedicated to tips on how to automate your bill payments as much as possible.
The first step before automating anything is to eradicate paper bills. You want to avoid mail in your mail box as much as possible. When on the road, you don’t have access to it anyway.
List all the bills you receive. You can use your Simple_Budget_Template from the previous post to help yourself. You can also use this more advanced version, Budget_Template_with_Payment_Types, with an extra tab for you to list the due dates, automation, and payment methods. The first tab is the simple budget. The second tab is the payment types. It's automatically filled up from the value you enter in the budget tab.
In your bill list, which ones do you still receive on paper? Most companies, banks, and providers encourage you to switch to electronic statements. I encourage you the same way. For each one of them, go online, log into your account, and find the document or statement management section. There will be a link or check box to change to an electronic option. Do that!
Ok, step 1 completed, paper eliminated!
All of my bill payments are done online. There are several ways to do that based on the options your providers offer. I'll talk about four.
- Pre-authorized Debit
- Bank Account Online Payment
- Credit Card
Debit, or automated withdrawal, is when you give permission to your provider to debit the monthly amount directly from your cash bank account.
I use this option first if the provider offers the service and if the amount is pretty much the same every month. If the amount varies too much then I use the credit card method.
I like this option because I don’t have to think about it and it’s paid with my own money, no credit involved.
Bank Account Online Payment
A lot of providers, credit card companies, and even government services can be paid directly from your bank account. You simply need to add them to your beneficiary list (or however your bank calls it) and make a simple online payment when comes the time.
This option is really good as well as it’s also only dealt in cash. On top of it, it can be automated so you don’t have to think about it. See the section below.
Ok. Credit card. This has to be handled well so it doesn’t become a dangerous game. It doesn’t mean to pay with it and let it sit there.
I use a pre-authorized credit card payment for providers that only offer this option and for amounts that may vary from month to month. My cellphone may vary because of travel data passes. In case a big surprise happen, I prefer having it on the credit card.
I make sure to set an online bank payment to my credit card on the day to cover the amount. I pre-schedule these payments and my head is clear.
Finally, for the bills I can't pay with any of the previous methods, I use Interact e-Transfer, which is a Canadian service. I do this directly from my bank account. Different countries offer different services. It’s worth it to look into it.
I have individuals I need to pay such as my landlord for the rent. Instead of writing a check, which you need to mail or hand out in some shape or form, I simply transfer the money with that service. It takes only a few minutes. I set the amount, add a security question, provide the beneficiary’s email, and press send. Right away, the recipient can click the email link, setup his account if not done already, and get the money deposited in their account in seconds. They don’t need to wait for the check, go to the bank, and cash it. You also don’t need to wait for the check to go through. The money is out of your account right away.
You can also consider this method when some needs to send you money.
Now this method can't be automated, therefore I keep this as a last resort.
Almost all of my transactions are automated. Only my two e-transfers are manual. It means that these are the only ones I need to think about. To reduce the frequency, you can consider lumping a few payments together and pay a few months early. It’s another way to have peace of mind.
Your pre-authorized debits are already automated. Just make sure you have money in your account. Easy.
You can set up your online bank payments to be recurring on a given date. Weekly savings, insurance or whatever else that you would pay with an online bank payment, go to your bank account and setup a pre-scheduled recurring payment on the proper date for each one of them.
Finally, for all the pre-authorized transactions going to your credit card, setup a pre-scheduled recurring payment from your bank account. Make sure it's on the day it's charged to your card or even a couple of days before as it often takes a couple of days for a bank payment to be processed on a card.
BOOM!!! Your home finances are in order and you are now ready to go on the road without disrupting the usual bill payments. Over time, with experience and practice, this'll be come really quick and easy. You'll be able to refine it and even eliminate additional spending.
In the next post, I'll discuss how you can handle your travel spending and how to save for your next trip WHILE travelling.
Who Am I? I'm many things. I'm passionate about tons of stuff. I love travel. I love self-improvement. I'm a sucker for optimization, efficiency, and minimalism. I renewed with mathematics and science, those are so amazing. Astronomy and chemistry are just plain awesome! I'm a student, a mentor, a traveler, a learner, an artist, an animator, and Disney brings me tears of joy! I love to grow and I will never stop! So who am I? All that and everything else I have not discovered about myself yet. It's a never ending answer!
Qui suis je? Je suis beaucoup de choses. Je suis passionné des tonnes de trucs. J'adore voyager. J'adore la croissance personnelle. Je suis vendue à l'optimisation, l'efficacité et le minimalisme. J'ai renoué avec les mathématiques et les sciences, des mondes tout simplement incroyable. L'astronomie et la chimie sont tout simplement génial! Je suis étudiante, mentor, voyageuse, artiste, animatrice et Disney m'apporte des larmes de joie! J'aime me pousser à fond et je ne cesserai jamais! Alors, qui suis-je? Tout cela et tout le reste que je n'ai pas encore découvert de moi-même. C'est une réponse sans fin!