I keep saying that I’m going to share the mistakes I’ve made with managing our family finances. Well, here is one such mistake as outlined below.
Over the past year, a number of very stressful and time-consuming things have happened and have made me quite forgetful. The first was that we bought a house. Then we had a second baby and then our first child turned into a toddler.
I used to be one to remember birthdays, both friends and acquaintances. It’s been a while since I really remembered someone’s birthday. I recently forgot my big bro’s birthday, some of my nieces’ birthdays, and my nephew’s birthday. I keep saying I need to write them down on the calendar, but guess what happens only a few minutes later? Yep, I forget and carry on doing something else.
It’s a vicious circle, and now it’s creeped into our finances and made me into the poorest family finance “manager” I’ve ever been. I used to spend a lot of time doing our budget, but I’ve almost completely just pushed it aside, like it’s some unwanted rag doll.
I knew it was bad, but it wasn’t until a few months ago that I noticed we were actually spending more money than ever, and I attribute that to pushing our budget aside. We live off one income, and it’s not like my husband makes a fortune or even a decent living. We made it this far because I was smart and always put money aside.
Besides the fact that I don’t pay attention to our budget anymore, we also got 3 new credit cards in the past 9 months alone. We were doing just fine with our one credit card, but I decided we “needed” the things we were buying, and it would be to our advantage to also get some credit cards. They were all store cards: Amazon, Home Depot, and American Eagle. Credit cards are quite alright as long as you are smart when you use them.
One of the problems with all credit cards is that, when you don’t pay the minimum amount by the due date, you are charged a pretty hefty late fee. When we had just one credit card, I always paid off the amount month after month. Because I have been super busy and forgetful ever since Bella was born, I might have forgotten to pay the minimum by the due date on two of the cards last month. No joke. I am kicking myself!
The late fee on both cards was $25. Essentially, I spent $50 (and a bit of interest) by being forgetful and not keeping up with our budget. If I had been using a bill pay system, this mistake wouldn’t have happened.
I figure I’m not the only person out there who has done this, so I’ve gathered some information about bill pay systems for our use. I am going to implement a system for myself and see how it goes. I hope that it helps me remember to pay all our bills, big or small, to avoid losing out on hard-earned money.
- Set Up Google Calendar to Pay Your Bills On Time on Free From Broke
- Create a Bill Payment Checklist on Cents and Order
- Organizing Your Bills So You Don’t Miss a Payment on Mom’s Favorite Stuff
- Stuck in a Cycle of Poor Money Management? 5 Habits to Help You Break the Cycle on The Budget Diet
- Create a Bill Paying System on Cozi
And here are five reasons why I should be using a bill pay system as part of our budget:
- I’ll know when bills are due – I thought I knew the due dates of the two bills from last month, but apparently I didn’t. They were only a few days late.
- Late fees are too high – $25 is huge
- I hate paying interest – Sure, it might not be much, but every little bit counts.
- I’ve got a really bad memory – You can’t rely on your memory (especially after kids. I’m telling ya.).
- It can affect my credit score – I haven’t checked my credit score since these two incidents, but I bet it’s gone down some.
What are reasons you use a bill pay system? If you don’t use one, how has it worked out for you so far?
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Photo credit: MorgueFile
Linked to: Thrifty Thursday (2nd time) and Frugal Friday
Other posts in this series:
You Need a Bill Pay System
My Struggles as the Family Finance “Manager”
Mistake #1 – Quit budgeting
Mistake #2 – Mixed up wants and needs
Mistake #3 – Used credit cards for things we couldn’t afford
Mistake #4 – Overcomplicated our budget
Mistake #5 – Checked over our accounts less often
Mistake #6 – Saved $0
Mistake #7 – Spent bonus money
Mistake #8 – Bought low-quality appliances
We have a lot of our bill set up with automatic with drawal. And the ones we don’t. . . well those are the ones I tend to forget. And yes, one of them has a 20 dollar late fee. The rest are a little more lenient with a grace period. But man, it stings when you have to pay that late fee!
I actually thought about setting up automatic withdrawals for some of my bills, but I would much rather do it myself so I am in control of when my money is leaving the account. I guess after losing out of that much money from late fees, I should give it a try, huh? Thanks for the suggestion, Leilani!
I actually use a budget planner for our finances (and wish my mother would switch to using it or let me organize her bills – because I swear that drawer looks so unorganized and messy!). I have reminders set in Google Calendar for when they are due but everything else is done through my planner.
I am definitely going to try Google Calendar for starters. I think a planner could work, too, because I like to see things on paper a lot of times.
UGH! I literally refuse to pay for those types of fees, I’d rather spend an hour on the phone with some representative explaining why I shouldn’t have to because you’re right, it’s super painful. It doesn’t always prove worth it but I have to try! I use google calendar and add all of my bill amounts/due dates on there because I’ll definitely forget if I’m not careful.
My dad would do the same thing. I just pay it ‘cuz I am really not great on the phone, and my husband refuses to call because of his accent/English. Great to hear that your system works for you!
I swear kids make us mamas so forgetful, don’t they? š When my second was born I totally forgot to pay the water bill and had to pay a huge fee (we live in what is still considered a rural county so late fees are hefty) which was almost double the amount of the water bill! A bill pay system has been my lifesaver – actually it’s been brain since my little rugrats were born! š
Yikes! It’s amazing what those water districts get away with. When I started forgetting little things here and there, I never imagined I’d forget important bills. But I’m glad there’s a way to help me remember now!
Ouch! Doesn’t that just make you sick? I really hate when I do things like that. Just remember that it happens to us ALL, and you are great for developing a new system to prevent it in the future!
Thanks so much for the encouragement, Chelsea š I know I’m not alone, but I guess I’m just comparing myself to my old self and feel so inadequate right now.
I’ve got a really bad memory too. Sometimes, I’ll forget. Shh, don’t tell anyone! Then they’ll send me the bill the next month and I’m like ahh, why’s it so high! Come to find out, I didn’t even GET the bill. I think that should be #6. haha. You might not get the bill and don’t pay it. Thanks for linking up on Frugal Friday. š
I’ve never had that happen, but that is sure to make you “forget”! Don’t worry, my lips are sealed. š
Our finances are tricky: I get paid once a month, and my husband’s disability check comes once a month. So I leave a chunk of money in our secondary account and transfer in a set amount each week. If I set up bill pay, I’d still have to worry about having enough money in the account to be sure we had the funds.
In short, it really wouldn’t save me much hassle.
Instead, I make notes in the calendar 4-7 days before the bill is due. (I’m a depressive, so I need time to work up to things.) We write everything down in the calendar, including a slew of appointments we have, so that works pretty well.
I gotta say, it’s nice to see another PF blog about what I like to call imperfect frugality. Thanks to our health problems, we screw up a lot. Well, a moderate amount anyway. More than my Type A brain wants.
Abigail, that’s smart to schedule to pay your bills well before they’re due. What I’ve learned since starting to write about personal finance is that there are a lot of people out there in my same situation. I don’t think there’s a way to be “perfect” with your money. Thanks for the visit!
Abigail, thatās smart to schedule to pay your bills well before theyāre due. What Iāve learned since starting to write about personal finance is that there are a lot of people out there in my same situation. I donāt think thereās a way to be āperfectā with your money. Thanks for the visit!
I pay way early, too. Our money is variable, so direct pay from my checking account scares me. But if it was regular, I’d definitely be doing it.
I have bill pay set up for a few accounts, but I still spend the same amount of time checking the bill, making sure we have enough in our account before it is taken out, and checking to make sure it went through, so when it’s all said and done I doubt I saved much time. Ha!