Long Term Budgeting for Bills

When you are budgeting for the year ahead, I have one of the simplest and worry free ways to deal with big annual bills like car insurance, property taxes and any other bill that is going to hit your pocketbook once a year.

Add up the total of these bills and then divide by paydays. For example, if you get paid once a month divide the total by 12. If you get paid every two weeks you take the number of weeks in a year ( 52 ) and divide by 2 which will equal 26.

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Now take the total of the bills you added up earlier and divide by the appropriate number, 12 or 26. Set up a simple bank account and put the amount you have figured out by payday and faithfully put it in this account either every second week or once a month.

You will not be worrying about those big bills any more. When it is time to pay them, you just go to that account and draw the money out or write a check. It's easy and worry free!

By Bev S.

Comments

December 26, 20150 found this helpful

I do the same thing that Bev S. just told you to do AND I am on a fixed income... It makes bill paying so much easier [I pay bills once a month] I never have to worry about 'do I have enough money for this or that' AS I have put aside the amount that I need each month for the year so when the bill comes due I have the money to pay it sitting in my savings.

For instance... I put $600 a month into my savings - that takes care of my car insurance, my house insurance, light bill, vacation money, one pair of shoes a year, Sunday tithing. $20 a year toward yearly gifts and $20 to my savings [which adds up to $240 a year] so in three years I would have saved $720 without even trying] this is a great system that I have been using for years. etc.

This does work well as I have done my bills this way [that Bev said] for years... I can't imagine doing it any other way really.

When you first start this "it will take about 2 months for you to get the hang of it" but hang in there it will be easier on you then trying to pay a bill when it is due and you haven't the funds 'sitting around in your savings' for it. BUT by saving up for this beginning in January you do have the money as you have saved a certain portion of money each month toward the bill...Good Luck!

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