Organizing Your Finances Made Easy

San Diego, CA. "Some folks seem to have troubles paying their monthly bills, even though they're not strapped for cash. In fact, all some folks need is help organizing their finances and creating a system to get their bills paid on time," says the nonprofit Institute of Consumer Financial Education (ICFE) based in San Diego.

"For the disorganized, a key to getting organized is as simple as keeping control of income and outgo. The reason some people pay their bills late is that they don't have a system for what to do when the bills arrive in the mail and when to pay them. Instead, on payday,
some folks spend big amounts right away, not thinking about any bills that may be due," says the ICFE.

Start by creating a list of every bill you are responsible for paying, the amount due and the date due. For bills that vary from month to month, use an average. Once the list of bills is complete, assign certain bills to certain paychecks. For instance if you get paid weekly, you will have four paychecks a month, so if a car payment is due on the 15th of every month, you may use the an amount from second paycheck every month. If the rent or mortgage is due on the first of every month, you may want to assign the third and fourth paychecks from the previous month. A few adjustments may be required to get the program started, however, it flows smoothly afterwards. If you receive a paycheck every other week, the principle is still the same.

After the bills are assigned to paychecks, use your growing financial self-discipline to insure that the bills are paid on time, according to the schedule. WARNING, if you put off one of two bills until the following paycheck(s), you will end up disorganized again. There is a silver lining for those who are paid weekly. Every four months they will receive a fifth weekly paycheck and if all the bills are assigned to paychecks, you will have an extra payday in those months and it may be an opportunity to pay off debts and or put more money into savings. To stay organized, some use budget worksheets from the ICFE and also use envelopes for bills and receipts, placing them in 12 monthly folders.

The nonprofit ICFE makes free information available on its Web site
at: www.icfe.info. For a reprint of “Setting up and implementing a spending plan,” please send a 60 cent stamped, self-addressed envelope
to: ICFE Spending-plans, PO Box 34070 San Diego, CA 92163-4070. The ICFE’s course in personal finance is known as the "Money Instructions Book” is a Home Study Course and is $29.95 plus $4 postage. Visit www.icfe.info and order on-line or send to: ICFE Home Study Programs U.S. PO Box 34070, San Diego, CA 92163-4070.

NOTE: Importantly, organizing one's finances so that bills get paid on time will only work if you already have enough money to pay your bills and still put food on the table and gas in your vehicle. If you are overextended and are unable to make payments on time because you don't have enough income, that is an entirely different matter, and you should contact a nonprofit consumer credit counselor.

©  Paul Richard, RFC and the Institute for Consumer Financial Education. All rights reserved.