Paying your bills on time is a tough, but essential skill to learn. If you don’t, you can fall behind with payments and that can leave you in debt. www.moneyadviceservice.org.uk reports the best ways to pay bills and give tips on what to do if you are struggling to keep up and pay on time.
How to pay bills on time
It can be difficult to manage bills, especially if they are starting to pile up. These few tips will help you stay on top of your finances.
Get organised: Get a folder and keep your bills in it. If your bills are digital, put them in a file on your computer. Keep track of when they need to be paid.
Choose a payment method that suits you: Direct debit is usually the cheapest and easiest way to pay bills, but there are other options.
Check your bills regularly: This means you will spot any mistakes and will notice if your bills rise and fall. Pick a day each month and use a calendar or an app to make sure you don’t forget. You can check payments on your bank statements.
Don’t let your bills get on top of you: If you are struggling to pay your bills, don’t ignore the problem, because it will only get worse. Make sure you are not paying too much.
Ways to pay your bills
Try setting up a separate bank account for your bills and transfer the necessary amount there as soon as you get paid.
Direct debit: Paying by direct debit means your bills are paid on time, so you will avoid late payment charges. Some companies offer discounts for customers who pay by direct debit.
Pay online or through phone banking: If you bank online or by phone, you can pay your bills directly. It is quick and easy and you are in control of exactly what you pay and when, but you have to remember to pay your bills in time.
Other payment methods
You can often send a cheque for the bill amount to the address provided by the business. Be aware it can take up to some days for them to process the cheque and receive the money from your account.
You can often pay a bill by cash.
Are your bills getting on top of you?
If you are having difficulty paying your bills, talk to the people you owe money as soon as you can.They may let you make smaller repayments until your financial position improves.
How to work out your income
Benefits: Look at the paperwork relating to any benefits you get at the moment. Jot down the amounts you get. Make sure you make a note of whether these payments are weekly, fortnightly, four-weekly or monthly.
Wages: If you are working, check your payslips and jot down your salary (after tax and other deductions).
Other income: If you have any other income coming in, write down the amounts and how often you get them. Don’t worry if the money you have coming in changes from time to time.
How to work out your outgoings
Household bills: Gather together all the bills you pay so you can see the exact amounts. If your rent is currently being paid for you, be prepared to start including this in your budget soon.
Living costs: The more exact you can be here, the better. For things like grocery shopping, it is probably enough to look at how much you spend across a few weeks and work out an average.
Insurance and loan repayments: Track down anything you pay on a regular basis such as home insurance, catalogue payments and credit card payments and make a note of them.
Children and pets: This includes things like childcare, after-school clubs and school trips. Some of these costs will be regular and others will be occasional so, you will need to work out an average. If you have pets, add up everything you spend on their food, vets’ bills, etc.
Travel: If you have a car, make sure you include all the costs. If you use public transport, you will either need to include the cost of your season ticket or work out how much you spend on average per week or month.
Leisure: If you are living on a low income, this probably feels like the most squeezed part of your budget, but remember to include one-off events like Christmas and birthdays so that these are budgeted for too.
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