Bills, Bills, Bills
Learn how you can organize your bills so that they seem less of chore and more of an achievement.
You see them every day, and you hate to open them. What more exciting news could they possibly bring than reminding you of your obligation? Don’t they realize there is a recession going on? Do they think you have extra cash lying around? Rather than looking at them like the 800-pound ogre that won’t go away, begin organizing bills by priority and take a conquering approach to them.
According to psychologist Maslow’s hierarchy of needs, the first thing you have to satisfy are physiological needs such as food, shelter and breathing. This is generally a good guideline to follow, but you don’t have to exactly stick to it to the T as you’re organizing which bills to pay first. You may want to consider this recommendation.
Keep a Roof Over Your Head
As you’re leafing through those dreaded envelopes, organizing the bills in order of least ulcer-inducing, remember first that you’ve got avoid sleeping under a bridge. Mortgages may be the biggest pain because they are the largest payment, but if you consistently miss paying that bill, then be prepared to pitch your tent underneath the nearest overpass. Okay, perhaps that’s a bit harsh. At least consider that you have to first take care of your physical needs.
Got to Get Around
The second priority in organizing your bills is making your car payment. Unless you live in a city and have daily access to fast public transport, you need be able to get to and from work or to that next job fair. In the United States, Canada and other spread out societies, you can’t really go too far without wheels. We are highly dependent on cars to perform day-to-day functions.
Health Insurance
Despite this being under large debate in the government, health care is not something to gamble with. Swine flu, cancer treatments, disability-related injuries, obesity and stress-related symptoms have all affected physical and mental health in some form or another, especially in this economy. You need to be able to see the doctor whenever necessary. Don’t leave your health to chance and whimsy.
Who’s On First
Pay the bill that has the earlier date. You might have thought this would be the first criterion in paying bills, but you have to consider your personal needs as you’re organizing. Can you afford a negative balance in your checking account until payday rolls around the next week? Or can you afford to lose your house for a month as you maintain a positive balance in your checking account? Once you meet your physical needs, then you can take on the pesky bill that knocks early at your door.
Highest Percentage Credit Cards
Paying off high interest-rate credit cards is emphasized time and again by financial experts for good reason. Missing these payments on a consistent basis just piles on unnecessary fees. Remember that you are paying a penalty for being late. If you show up late to a meeting, you get a stern look. If you’re late with a promised card payment, you’re slapped with an added cost you don’t need right now. Some credit cards are a lot harsher about your delinquency than others by how high they charge you.
I agree in general with your priorities. You and your family must take first priority. Then come the other bills. As for prioritizing the credit card with the highest as most important I believe the opposite is true. If it takes 5 years to pay off the largest of 5 credit cards all during that time you are making payments on all five cards. If instead you pay off the lowest balance first you will soon have 4. Now the freed up by paying off that card will go to the next lowest and soon there are 3. Until they are all paid. There is a psycological boost every time you pay off a credit card and with each card you get a satisfying sense of achievement
I agree, you can't afford to get a negative balance. Once you have a positive balance and have some cash to spare I think you should explore possibilities to make some more though. Internet businesses is one option, selling on e-bay another.