Catching up on bills
Are you falling behind on bills?
It happens to all of us at some point or another, getting behind financially. Catching up on bills is never an easy or fun task but it’s part of being a “grown up”. Don’t you wish you could go back to being a kid? When the most stressful part of life was mom making you eat all your veggies? Since that’s not possible, here is my strategy for getting caught up,
First thing I do is write out all the bills/debt we have and how far behind they are(dollar amounts). Doing this gives you a clear visual picture of what kind of catching up you’ll have to do. When listing the bills I always put the top priority bills at the top and work my way down. Even though your credit card bill may be due before your electricity bill, the credit card company can wait it if comes to living without power.
Next, figure out how much of your income you need for necessities(like food, gas, medications, diapers ect). This is without ANY extra spending. To be honest this is a time where you should try to tighten up these expenses as well. You may love eating out but cooking at home could save money. The brand of diapers you prefer are $15 more. So, you may need to bite the bullet and get the cheaper ones(that still work I promise) for a month. Just remember cracking down for a short time can allow you to go back or your comfort zone once you are caught up and have the extra mula again.
Once you have the amount of money you need to live off of, subtract that from the amount money you bring home. Just throwing numbers out there, let’s say you bring in $1300 every two weeks. You figure your necessary spending is $300 of that paycheck. You have $1,000 to put towards your bills and debt every other week, or $2000 a month. Now, if your bills come up to over $2,ooo every two months your already(to put it blunt, I’m sorry) living outside of your means. That doesn’t mean that there aren’t ways to make extra money and get ahead, but that’s a whole other post! 😉
But, for this post, let’s say your bills would normally add up to about $1,400 of that. You have $600 every month to put here or there and catch things up.
The most important part of this is to write out your budget. When you decide what bills come out of what check, write it down! Once you fill in your regular bills, now comes the fun part. We get to put that extra $600 to work. You decide what gets some extra weight off its back every time you get paid. Remember what things are most important though. As rewarding as it is to see that credit card balance drop, you may not enjoy living without your cell phone service. Also take into account what bills have major late fees if they don’t get caught up in a timely manor.
A quick tip
I write out my budget in my planner. This way I can put a calendar with my budget to visually see what my plan is. I also re-total at the end of every month at the bottom of the page to see the progress I’ve made. Yes, I’m a very visual person and like to actually see what’s going on!
It may take you quite a few months to get caught up, depending on how tight your budget is. Or, sticking to a no extra spending budget for a month may be enough to get you out of your hole. Everyone’s budget and lifestyle vary so this is no “one size fits all” approach. This is simply my strategy for getting ahead.
The first bit of extra money(that doesn’t have to go towards catching up a bill) I like to treat myself! Nothing huge or expensive. Maybe I’ll go get a new outfit from the discount store or take myself to lunch. Rewarding yourself for the hard work you put in is something I don’t feel anyone should skip out on. If you want to keep the momentum going though, start putting that extra money(or at least some of it) into a savings account. It’s amazing how normal it seems once you get used to cutting expenses. You won’t feel like living on leftovers for lunch everyday and no extra driving around is torture if you’re choosing to do it and have extra money instead.
Being behind may be one of the worst feelings, but being ahead can also be one of the best.
Having a game plan to keep your head above water is necessary managing a budget. Knowing what you make, what you have to spend, and where to put to get you ahead will get you on the right track. All you have to do is buckle down and get organized! What are some of your home budget tips? I’d love to hear them!