Day 1 - Prioritize & Organize Your Bills

Discussion in 'How To Save Money Using 60 Minutes Everyday' started by Shobir, Oct 9, 2013.

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  1. Shobir

    Shobir Administrator Staff Member

    Admin Post
    After turning my personal finances around by spending 60 minutes every day on small projects I decided to share everything I did to get my self in a better position when it comes to money. I will be serializing all the 60 minute projects so other people can try them so they to can get their finances together. Most of these tasks will take no more than an hour and it's those tasks that we love to put off. So join me from Day 1 to Day 13 to see if you can get yourself in a more prosperous place financially.

    Day 1 - Prioritize and Organize Your Bills

    Whenever a bill comes through the letterbox the last thing we want to do is open it. Most of us, myself included, love to put things like these off and pay them at the last moment. In a previous life before I got my finances together I was probably paying between 2 to 5 fines every month just because the payments were late. The best place to start your day 1, 60 minute project is to get all your bills prioritized and organized is such a way that you never pay a fine again.

    Get all of your most recent bills together, this is a pain but it has to be done. Get all your utility bills together, get all your credit cards bills together, get all your other miscellaneous bills together. Once you've got everything together go through all of them with a fine tooth comb and put in the following three piles, (1) Utility Bills (2) Credit Card Bills (3) Miscellaneous Bills. Another point to mention is that some services or products that you use might not have a bill and for these just get a piece of paper and list them all.

    Take the miscellaneous bills first, this is where you should try to cut most of your spending. If you're paying for any services that you hardly use then cancel these immediately, if you've got a membership to a magazine subscription that you seldom read or have subscription television that you never watch cancel them without hesitating. When I did this exercise myself I was able to cancel my gym subscription, paid for TV channel subscriptions, magazine subscriptions and many more. Just send them a quick email or give them a call to cancel, you could also just cancel the direct debit from your bank and leave it at that.

    The next pile to take is the utility bills. You need to ask yourself whether you're paying more than you need to for your gas, electricity and water. Check your most recent usage and then use a price comparison site to see if you can save money by switching providers. If you can quickly call up the utility companies and ask to be put on a cheaper tariff otherwise you'll move to the cheaper provider. Most of the time they will comply but if they don't just switch over, don't hesitate, it doesn't pay to be loyal . If you can save by switching and fixing your energy costs you'll be in a much better place financially.

    The last pile is the most important pile. The last pile should consist of credit card bills and mortgage statement. Go through each one of those bills with a fine tooth-comb and find out how much interest you're paying. Call up all of the credit card companies and ask them to put you on a lower rate otherwise you'll move your balance over to another card. If you've got a good credit score you should be eligible for zero percent credit cards. Most of the time the credit cards will lower their rates but if they don't you should not hesitate and switch over to the zero percent credit card. Your aim should be to reduce the amount you pay in interest so you can pay off the balance quicker.

    Another habit that you should try to get into is automating all your payments so you never miss them. You can set up a standing order or a direct debit with your bank to pay off the balance in full or specify the amount you wish to pay. By automating all the bill payments you can just relax and knowing that you'll never have to pay another late payment fee again!

    So how much can you actually save? well it depends entirely on you. If you want to achieve your financial goals quicker then you'll cut fast and deep. If you want to take small steps you'll cut where you can without denying yourself what you want right now. When I practiced this exercise it actually took more than an hour but the time just flew by, when you get into the swing of sorting your finances your momentum keeps on building and results are amazing. After completing all the steps listed above I was able to shave £230 from all the expenses, most of my subscriptions went without hesitation and I was able to get myself on a cheaper rate credit card. By the end of the year I was able to save £2760 most of which went to top up my emergency fund and pay off my credit cards.

    Prioritizing and organizing all my bills not only made me better off financially it also gave me the momentum to carry on and look for new ways to make and save money, it might be just an hour but it could the the hour that turns your finances around and gets you to a better place.
    Last edited by a moderator: Dec 30, 2015
    Jason and hamza like this.
  2. hamza

    hamza Newbie

    A lot of people avoid doing this simple exercise because they are scared. I myself was scared to face up to my credit card bills and just buried my head in the sand. I eventually did and now I'm much better off because I know the extent of the problem and can plan to pay everything off. Not taking the first step is the worst thing you can do financially.
    Jason likes this.
  3. Alistair

    Alistair Newbie

    I hate credit cards with a vengeance. I don't blame people when they choose not to open their credit card bills, it's seriously depressing especially when your minimum payments are the same as the interest you pay. I can't wait to be debt free.
  4. Jason

    Jason Newbie

    Cutting deep and fast is the best way to kick start your frugal campaign. When I sorted my finances out I prepared myself mentally for a real tough time, at least for a couple of years. After enduring with the cuts I am now in a much better position. If I lost my job today I would be able to last 5 years without having to earn a penny and my savings generate an income of 30% of my monthly expenses. Things are definitely going in the right direction.
    Eduardo, LiverpoolLife and Miles like this.
  5. Miles

    Miles Newbie

    Nice way to look at things. Having money in the bank account certainly gives you peace of mind, knowing how much you're earning spurs you on to keep saving. Once I reach 60 to 70% of my expenses using passive income I'll seriously consider whether I want to work or not. Just having the choice gives you an immense sense of liberation.
    JibberJabber27 likes this.
  6. I cant wait until I reach 100% of my expenses with income from my asset, I sometimes even dream about the day it's going to happen! I've got a plan and it's slowly getting there.
  7. LiverpoolLife

    LiverpoolLife Newbie

    I don't want to rain on your parade but I've saved enough to last 12 years without having a job and I've reached 68% of my expenses using passive income.
    Shobir likes this.
  8. Shobir

    Shobir Administrator Staff Member

    Admin Post
    I guess the best position to be in would be having enough money to last forever with 1000% + of expenses reached with income. I guess my kids would really be thankful for that :)
  9. Eduardo

    Eduardo Newbie

    I cant wait to reach the levels you guys have reached. I wish I started earlier but better late than never. Whats the best way to invest the money I save?
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