5 Simple Steps to Reduce Stress and Manage Your Bills

Every month like clockwork, they arrive in your mailbox. First it’s the mortgage and the utilities bills. But what starts as a trickle at first quickly becomes a flood, with the car and student loan statements, the credit and store card bills; the list can go on and on.

So what do you do with your bills each month? Do you pile them on your desk or coffee table? Do you leave them sitting in your mailbox or stuff them in your kitchen drawer? Does your method of money management have you scrambling to find your bills or paying them way too late? If you answered yes to any of the questions above, you know that putting your bills aside or hiding them away doesn’t make paying them any easier. In fact, leaving them disorganized and avoiding them does nothing but increase the stress and late fees that come about when your bills are not paid on time.

Well, if you’re looking to bring order to your everyday financial life, you can start by taking these 5 simple steps:

Step 1 - Create a "Bills budget"

No matter who you are, financial success begins with a plan. In this case the plan is both easy to create and easy to follow. Simply write down a list of the bills you receive every month. Next to each bill item, write down the corresponding expected monthly amount and the date the bill is due. Add the expected monthly amounts to get a total amount of bills due for the current month.

Step 2 – Open a separate "Bills" bank account

If you appreciate the efficiency and easy access of online banking, but still find yourself confused by having to search through all of the spending items in your account to see when and what bills were paid, you can clear things up by streamlining the view of your bill payment activity by opening a separate account that will only be used to pay bills. This can be done with a simple visit to your banking institution (some can even do it over the phone) and normally at no cost to you. Once you have a bill payment account set up, be sure to fund it with enough money to cover the total amount of bills due, which you should know from completing step 1. An automatic transfer from your spending account at the beginning of the month or allocating a portion of your paycheck to be directly deposited to this account may be an ideal way for you to keep this account properly stocked with funds without much fuss.

Step 3 - Replace your mailed bills with online statements that are emailed to you each month

When you come home to find a bunch of bills in the mail does it put a smile on your face or a grimace? For most it’s the latter. Too much paper overwhelms most people and leads them to put bills aside or worse, avoid them all together. Interestingly enough, for many of those same people, emails don’t have the same effect. A growing number of tech-savvy individuals look forward to sitting down each day to read emails and manage their affairs. If you’re the type of person who’d rather receive emailed online statements than paper mail take advantage of offers to have your bills sent to you on line instead of mailed to your home. With the careful setup of rules and filters, which most modern email clients support, you can even automate the filing of your financial records (see step 5).

Step 4 - Pay your bills online from your fully-funded Bills Account

Here is where the plan really starts together. As soon as you receive your statements, go to your online, fully-funded Bills account, enter the amount owed for each bill and schedule timely payments for each item. Because this account is fully-funded and separate from your general spending account, you can pay your bills with ease, knowing that your funds are untouched by everyday spending and readily available to pay your bills on time. For bills that don't ever change, like the cable bill and mortgage payment, you can often setup automatic payments through your online banking system.

Step 5 - Create an electronic filing system and file them away

It’s very easy to save on line statements by using the file save feature on various desktops or by taking the extra step of creating adobe documents of the electronic statements your receive. Take a few seconds and click your way to more organized bill records by saving your electronic statements to folders in your personal computer accounts. Create a folder for each bill save each bill statement in it’s folder by month. By using this filing system you can easily refer to you bill records, should you need them for tax purposes, to argue unlawful fees or to negotiate new terms or rates. Many email clients offer methods of automatically routing email to folders. It would be worth the minimal amount of effort it takes to research these methods and put them to good use. After all, you only have to do it once!

So there you have it, 5 steps to reduce the hassle that is your monthly bills. No matter how great the plan or organized the system, there is still an element of discipline that one must apply in order to effectively manage their financial obligations. Even with these steps, effective bill management can require consistent oversight and a fair amount of attention on your part to ensure they don't spiral out of control. If you often find that time doesn’t permit, or that you are unable to manage your day-to-day financial affairs, you may want to consider using the services of a daily money manager to handle your bill payments and other monetary transactions. For a reasonable fee, a daily money manager can help reduce the overall stress of managing your money and allow you to get back to the things you really enjoy.