Paychecks and Payments

This week I discussed trying to pay bills on time with one of my friends.  We were talking about getting paid twice per month and how it can be a challenge. We had slightly different reasons of why it's challenging but the one resounding reason is that it's hard to budget yourself and still have a spontaneous social life.

Over the years I've received my pay in several ways - Weekly, bi-weekly, semi-monthly, and monthly.  Of all of these types, I had the best experience with my budget, bills and on-time payments when I received my paycheck on a monthly basis in my last job in Nevada.  Why?  Because once I was paid for the month I'd sit down and write out all of my upcoming bills.  I'd pay my rent, do any car maintenance, pay my credit cards, etc.  Whatever was left was mine to manage for the next few weeks. It helped my credit score quite a bit because many of my bills were paid early and I always paid a little extra. Two great things to boost your FICO Score.

When I moved to Virginia, this semi-monthly pay was a hard pill to swallow. I had to think about how and when I would pay my bills. I had to maneuver varying "pay by dates", car insurance, credit card and rent payments.  Trying to figure out which pay period my payments would be taken from was trial and error - AND involved quite a few bouts of that horrendous feeling you get from seeing an insufficient funds notice from your bank! Aaack!!! That's not mentioning that I hadn't begun paying back my student loans - How would I manage a nearly $500 monthly student loan payment on top of a car payment that was just over $400? I have paid off my car since then, thankfully!

During the 6 years since I've started receiving my salary on a semi-monthly basis, it wasn't until this past year that I felt like I got it figured out. You really have to budget with more intention - It. Takes. Work.

What I had to do was look at my bills and see when the due dates were and balance them out as well as I could between pay periods. That required a couple of phone calls to companies to move some dates around.  Common sense, right? Now, if you've read my older entries, you know I've entered into a money management firm to deal with all of my creditors. Clearly what I was doing wasn't all that effective and I still ended up in trouble (Pay Day Loans anyone?). The experience of this all has lead me to having a better understanding of my money and myself.  Consequently, all those credit cards and lines of credit I once had have been closed. Not that I could have used them anyhow. They were all pretty much maxed out and even attempting to use them was a game in itself.

No one really teaches you how to be financially responsible. It's a skill most people learn through trial and error (and sometimes humongous errors). 

Which way do you receive your pay check? Do you have a specific plan to pay your bills on time?  If not, why don't you?

Continuing on my journey - and yes, it's the first of the month and I've already made my payments for this pay period. YAY!

Educated. Empower. Economize.