A new way of doing things
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| Thu, 01-21-2010 - 4:37pm |
Since it was pointed out on here a few days ago that the definition of insanity is doing things the same way over and over again and expecting a different result and since I have an insane (also obscene) amount of debt, I've decided I need to do things differently.
In the past I paid bills all through the month. When my husband got paid or I got a check from freelancing I would pay too much on some things because it looked like we had a lot of money and then we'd run out and I'd have to rely on credit cards.
Today I did something different. I totalled up all the utilities and cc I needed to pay through the end of the month. I paid extra on two bills -- one $96 cc was paid off and another with a balance of $350 I paid $100 -- and everything else I paid the minimum. I wrote checks out of a checking account we dont' use and transferred just enough money out of our regular account to cover them. I think I will try to pay bills twice a month and do exactly the same thing so I know exactly what is going to bills and what is left over. I have about $1500 in smaller balance cc that I can pay off completely by June by throwing extra money at one targeted bill each month. Unfortunately I will then have to go after the huge cc balances which will take roughly four years to pay off but maybe by then I will be in the habit of doing it this way.
I am also working on building an e-fund. I think I will take a portion of every check I get from freelancing, even if its only a $300 check and put it in my efund account.
Does this sound like a plan? I have been so undisciplined in the past. maybe this will help.
Jenny

Good luck and let us know how it is going.
What I started doing which really helped me was taking my bills and debt, adding up the totals I needed to pay each month and dividing that into weekly amounts. For instance, my mortgage is 1239. That is approx 286 a week. My goal was to start making sure that my mortgage was never late again and I always had the money to cover it so I started transferring 286 a week into my savings. It worked like a charm! Now I've started doing the same thing with my 3 biggest bills, my mortgage, my car payment and my condo fee. These are things that cannot be late, so I transfer the weekly amount before I can even think of spending it!
I used to do exactly what you did. I'd have a ton of money in the bank after getting paid and I'd think I could either over-pay bills or over-spend! Then I'd run out of money when I really needed it. I have recently implemented a budget plan and I have never stuck to a budget in my whole life! But this time, it seems to be going pretty well. This is my 3rd week on the budget. It sounds like your plan is going to work great! Just be careful of all those expenses that aren't monthly. I've really tried to add in all of my expenses into my budget, my yearly taxes, my car registrations, clothes shopping for school, Christmas, birthdays. Good luck!!!
Sounds like you are finally telling your money where to go instead of it telling you.
If it were me I would do one thing first - build the EFund to $1000.
Insanity yes, I know the feeling.
I like your plan. Do pay attention to due dates. Make sure the money is there so you are not late. And as pp said, pay attention to putting money away for things that are due every month but quarterly or yearly. I also agree with Marie. Build that efund before you put extra(above minimums)on CC. My stress level when down immediately!
Good luck!
I think that sounds like a pretty good plan and I wish you the best of luck with it.
Do you have an organized place where you keep and pay your bills? I used to be really disorganized and I'd lose a bill for a while and then when I remembered it needed to be paid it was already late, etc. Now I always put them in one place - a napkin holder in the kitchen actually, lol, hey it works for us. :) The location also works really well because they are in sight constantly. They aren't tucked away somewhere where I could ignore them and forget.
I also learned that paying attention to due dates is really really important. Not just so you don't accrue late fees, but so you can look ahead and know where your money will be going weeks in advance. When a bill comes in the mail I immediately open it to check the due date, then I write the date received and the due date on the outside of the envelope and put the whole thing in the napkin holder. One glance at the envelope and I know if it needs to be paid soon. I also track my bill paying in a notebook. What I paid and when I paid. So if my BF says have we paid the electric bill yet? I can look at my notes and say "No, we usually pay that around the 27th, I expect it to come in the mail around the 14th,
It's sounds pretty good to me, Jenny.
Norma
"Patience is the best remedy for every trouble"- Plautus