Tracking the Bills and Doing the Checkbook

Posted: May 1, 2013 in Budgets, Financial Organization
Tags: , , , , ,

As promised from yesterday, I am going to explain how we track our bills – it’s a threefold process really, the first part of the process was to collect them all in one location, which we’ve done.  I have all of the bills in what I call current status in a folder, once paid off it’ll get filed with the other bills we’ve paid off – they each have a piece of blank paper attached to them with any necessary notes on them, an example cover page looks like this:

CitiMortgage, Account# XXXXXXXXX (Not going to list it here obviously)

Statement Date: 04/17/2013

Amount Due: $5,234.00 (this is a rough estimate, I don’t have the bill in front of me currently)

Date Due: 05/01/2013

Below this information I track the payments made since receiving my statement, these are pulled from the budgets and the checkbook:

04/22/13                     $400.00 paid                                Bal. Due: $4,834.00

This process repeats every bi-week we pay bills that way I can track what is being paid, what’s been paid and how much is left remaining, specifically for items I am paying down on, like DB Plumbing which has a balance due of roughly $324.00 to be paid off by the end of the summer – I use this to track how many more payments I have to make and when I can switch that allocation to another bill to then begin paying that down quicker, ex: when DB Plumbing is done, I’ll then allocate that $20.00/week over to LabCorp’s collections agency to pay off that $350.00 faster, once that’s done it’ll roll over into something else and so on and so on.

The second part of this process is done utilizing a day planner (an online calendar works as well) – On the day I receive a bill, in my day planner in Red ink I notate on the due date the vendor/creditor and how much is due, then on the Friday’s I count how many are between the date the bill is received and the due date and figure out how much I’ll need to allocate to each bi-week bill pay day;

Ex: Credit Acceptance, I know this bill is due every month on the 6th – there’s generally 4-Fridays between each due date, the total amount due each month is $336.98 – I take that divide by 2 and the end result is roughly $170.00/bi-week (I use whole  numbers when paying bills, pennies are a nuisance I don’t take into account), so then I notate that on the calendar on the Friday I pay bills, which is this Friday the 3rd, so then the next one will be on the 17th and then the 31st and so on.

The same process pans out for each bill due, generally those received through the month are the utilities, and they fluctuate but I find a way to pay them.  So when I received our Progress Energy bill I put it on that paper in the bills folder, then notated it on my calendar counting the Fridays between and figured out how much was due each bi-week to prevent shut off (we’re short paying this just to prevent shut off because of the mass amount of other money going out from our account right now – not only to stay current with the car, but to keep funds going to CitiMortgage.

The third part is any pre-scheduled drafts from our bank account each month, like my student loans, Austin’s TKD payment and the other $5.00 bills we pay each week – at the start of the year I sat down with my day planner and using the ‘bill pay’ screen on Bank of America’s website I wrote down each payment on the draft date so I wouldn’t forget them – we have a lot that is pre-scheduled for draft each month and I found I was forgetting them…not cool!

All three of these processes are then carried over when doing the budget each week – seems more time consuming that it truly is!

Alright quickly as this is getting long winded – the checkbook:

Some people choose to use the register that comes with their checks, others use some computer oriented program (like quicken or even mint.com) we use a spiral notebook to do our checkbook – it’s just easier this way for me.  It works like any other checkbook would, the debits, bills, deposits, etc. are recorded and balanced against the bank account every Friday.  However,  I’ve chosen to color code the transactions so I know immediately what’s what without having to actually read the item:

Green – These items are any debit card purchases made between pay periods (note these are the items I  deduct from the previous week’s remaining budgetary funds), as well as any KTC (keep the change) transfers and bank account transfers to and from Savings

Purple – Deposits (paychecks, gifts for birthdays, etc.)

Red – Bills, any and all bills paid, or are scheduled to be paid

Blue – Transactions pending on payday, this is JUST for Fridays

My checkbook is rather colorful, but it’s the easiest way for me to track everything!

That’s about it everyone! Hope this has been helpful!

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