Advice (bill paying)

Bendy1224

Hi all, 

I am really struggling with understanding how to manage my finances. I live with my partner and all our money going out and in is joint. 

Unfortunately it is only myself who just loves money and wants to be better at managing it and to have full understanding of it and control. 

We have various money sources coming in each month at different times and trying to set a system up so we can pay are compulsory bills on the same date but not sure how I go about this.

I have wrote everything down on a spreadsheet online and can see we have money left after bills has come out but not sure I can get where I want with the bills so it all comes out on one date. 

I did a calculation which was dividing the bills amount by 4, but the amount would just screw us every week with not having no money to fall back on. 

Think from memory it was £400 and something and that’s close to what I get coming in a week.

I’m so overwhelmed, depressed, and feel useless and crap which is making my mental health even worse on a daily basis with constantly thinking about a solution all the time in my head. 

One thing I can say which I think is a good start which probably would have been advised on here if I didn’t already take the step to create a bills pot.

Look forward to all your incoming replies 😀

Jami74

Bendy1224 said:

We have various money sources coming in each month at different times and trying to set a system up so we can pay are compulsory bills on the same date but not sure how I go about this.

I have wrote everything down on a spreadsheet online and can see we have money left after bills has come out but not sure I can get where I want with the bills so it all comes out on one date. 

Can you have a separate bank account that those bills come out of? Then, once a month on a date that suits you, you fund that account by standing order from your main account. I fund my bills account on the first of the month, the full amount that is needed to cover all of the bills for that calendar month. In my mind all of the bills get paid on the first of the month and I have to make sure the money is there for them. You could choose any date, for example if you chose the 10th of the month you'd have to make sure you were depositing enough to cover all of the bills that would come out before the 10th of the next month. Be cautious with funding it by standing order, if your date falls on the a weekend the money might not go in until the Monday whereas a direct debit might come out over the weekend anyway. So, try to choose a date that is a couple of days before the first bill comes out just in case it falls on a weekend one month. Rather than moving all of the bills over to a new account, it might be easier to keep your existing account as the bills account and open a new account for the money coming in. Either way, it can be helpful to have two accounts, one to receive your income and another one to manage the regular bills.

blue.peter

I agree everything that @Jami74 says. In particular, having a second bank account, specifically for regular bills, could well be helpful. I certainly found it so for a period (roughly 1985 - 1995).

In addition, you might find it helpful to use a money management program. I use, and recommend, AceMoney. However, it does cost a little money. If you want a free one, you could try MoneyManager EX.

The point of this is its use as a planning tool. You can set up your reguilar payments - both incoming and outgoing - and see where you'll be at any time (the software allows you to look ahead and see what's coming).

My approach is to treat every bill over the next month as being due as soon as I get paid, leave a bit for ad hoc expenses, and then sweep the rest into savings. How much needs to be left for ad hoc expenses will vary a lot from one person to another, so I can't tell you what'll be right for you.

I find it helpful to put pretty much everything (food, petrol, entertainment, car servicing, insurance... you name it) I spend on my credit cards, and have them paid in full by direct debit. The bill comes in each month a week or two before I get paid, so that the DD goes out a couple of weeks or so after I'm paid. That way, each month's spending is treated as an expense to be paid out of the next pay cheque. It also means that I only need to keep a little money back for ad hoc expenses.

I appreciate that my income might be more regular than yours, but the key is predictability. It might be beneficial to see if you can adapt this approach to your circumstances.

blue.peter

PS - you might find this thread helpful.

Rob5342

If you use Monzo or Starling you can put things into pots/spaces which is much easier than having a seperate account for bills.

I'd say step 1 is to modify your spreadsheet so it includes a savings amount and a weekly budget you allow yourself. After that it becomes a cashflow exercise to make sure money is available at the right time. Over time I've managed to arrange things so that 90% of my bills come out on the 1st of the month. There was normally an increased bill involved in moving the date so I changed one a month.