When you finally make the big move into your very first apartment, you are pretty unaware of the big financial hit you are about to take. No, that doesn’t mean you’ll be broke for the rest of your life nor does it mean that you can’t make it on your own. However, it does mean that you will need to make changes to the way you budget your income or (in some cases) create a budget for the first time in your life. Sure, you plan for rent and you may even plan for utilities, but life happens, so it’s important to be prepared for the unexpected and to stay on top of bills. As a first time renter, I’ve had to learn the hard way. There have been times when I’ve forgotten about a bill, over drafted my account, and charged my credit card when I shouldn’t have. As they say, you live and you learn. So I’ll pass along here what I’ve learned.
1. Keep A List of Upcoming Bills & Set Reminders
As I said before, there have been times when I’ve completely forgotten about paying a bill. The paper bill or electronic bill arrived, I put it aside, and then never thought about it again. After a few late fees, you’ll thank yourself for keeping a list of bills you have to pay and setting reminders for at least 5-10 days in advance. It can be a post-it note on your refrigerator or a set date on your phone calendar. Just find a method that works for you and stick to it.
2. Pay Bills Before They Are Due
I know. You’re probably giving me a look of pure skepticism, but hear me out. Over time, I’ve found a neat little trick…if I pay every bill that I can at the beginning of the month, then I have all the rest of my money to use for other things. This way, I have everything out of the way, I’m not worrying about what I have and have not paid, and it guarantees that each and every bill is paid when I have the money. Even if I can’t pay all the bills all at once, I still pay them way before they are due. That way there is no chance of a late fee or me running out of money before everything is paid for the month.
3. Pay A Little Extra When You Can
I know, this one sounds even worse than paying bills before they even come due, but I promise the benefits outdo the cons. When I make a little extra money one month, I always try to contribute some of that money to paying extra on certain bills. As a recent college grad, I’m one of the many who has student loans to contend with each month, so when I have extra cash, I pay anywhere from $5-$100 extra on my student loans. This can be a great tool for staying on top of any of your bills. Pay extra while you can and it will help out monumentally over time.
4. Say No To Charging On Your Credit Card
You’ve heard it over and over again, but I’ll say it again. Don’t be careless with your credit card(s). My personal motto is that when I use my credit card, I pay it off one to two days later. That way, I’m building credit and getting the spending points without the downside of tons of interest.
5. Be Prepared For The Unexpected
As the year goes on, new and unexpected costs are likely to come your way. So to avoid a meltdown situation, always keep a savings account and contribute to it regularly. Flat tires, high winter utility bills, etc. are bound to happen every now and then, so having a backup plan like a emergency savings account can keep you out of budget trouble.
6. Treat Yourself Sometimes
When all your money goes to bills, it can be easy to have one of those days where you just snap and spend lots of money of all the fun things you’ve been missing. To avoid having those “I don’t even buy anything for myself” days, spend a little on yourself once a month and skip out on the bill paying blues.
7. When Needed, Ask For Help
We’ve all had an emergency situations. The key to being budget savvy is knowing when to handle it yourself and when to ask for help. Before things get out of hand and you are facing mountains of debt and a ruined credit score, ask for help. Whether it’s a family member, a friend, or a roommate, ask for help when you truly need it, don’t make it a habit, and pay them back. If you have a catastrophic credit situation you may need professional help from a reputable credit counseling service. Check out the National Foundation for Credit Counseling for an agency near you.
Have budgeting tips of your own? Share below!