Don't you just hate it when you go through months of never-ending bills?! Or even periods of never ending bills?!
A few months that I'm not particularly keen on are January, June, July & December for those reasons. I never like paying my bills monthly so I elect to pay them upfront and annually if that option is applicable. Less hassles and no need to think about them for a year after they're paid. When I was young, my parents told me that once you pay your bills, that's it. No more time wasted on thinking about it. Time is valuable. Each bill occupies about two minutes of my life. Two minutes is the time it takes me to open up the envelope, check the bill, note the due date on my calender and the time it takes to pay the bill online on that due date.
The problem with setting bills aside and paying them later is that you have to keep thinking about them until the moment you pay them. Same with monthly bills. You have to keep thinking about paying them monthly and if it's on automatic debit then you have to ensure you keep sufficient funds in your transaction account to pay for them. So an annual bill will consume two minutes of my time and a monthly bill will consume 24 minutes of my time in a year.
For those in financial trouble, not only do you waste time thinking about the bills, you waste time when you have to open up overdue reminder letters and emails, you waste your time calling up to re-connect services that got disconnected or suspended due to not paying your bills and you also waste time when you have debt collectors calling to hassle you. That could be 15 to 30 minutes per bill. So if you have lots of bills, think of all that time you waste on them!
Not sure why this year feels any different but it does. Maybe it's because the price of everything has escalated. Inflation- food/groceries, insurances, energy prices, transport, blah blah blah. I've been keeping an exact tally of my expenses out of curiousity in trying to determine what I spend on each typical 'budget' category since I don't have a budget and was curious after reading a few bloggers insight into their spending.
So how can I write a financial/money blog if I don't have a budget? I'm more interested about the strategies to investing and how to invest for the future rather than the baby steps of saving money since that is not a major issue for me. I guess you could say I have a rough budget. A simple one. If I earn $x per week, then I have to spend less than $x per week. You know, the wise idea of spending less than you earn. I've never bothered with the tiny details because I knew that I have savings and investments that I could liquidate to meet any massive emergency bills.
The main strategy that I believe works really well is to transfer any excess savings to a high interest savings account. When you have sufficient savings - move them into investment vehicles (my personal preferences are stocks and real estate). Any new bills that arrive, they are to be deducted out of your current income so you just spend less for that week or the next few weeks until they you pay them.
Very rarely do I spend my previous savings. Only in real emergencies and they are rare and more the exception. Most large annual bills are recurring anyway so you should know when they're going to be issued and when they should be paid.
Eg: I knew I had car bills due every June that amounted to roughly $2724 and that's just car bills(pink slip, green slip, insurance, rta road rego, car servicing and replacing tyres)...ouch. So I had to cut back on discretionary expenses a bit in May to pay the expected bills out of current income and not use previous savings. That way, my investments and savings are left alone to re-invest and compound without me interfering with them.
The aim is to never erode your previous savings and investments. That's the secret to building wealth and growing your assets. If you own your own business, even better.
We all have those months where the bills are never-ending and the goal is to not give into temptation and reach into your savings or emergency funds to pay for them. Try to adjust your discretionary expenses so you can pay your bills out of your current income until those expenses are paid for.
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