Okay, Lesson 2
The supplies you need are really expensive. (Not) I recommend a 2 pocket folder and notebook paper and a pencil so you can erase. Use what you have for now. On a blank piece of paper, write Killer List on the top. I called my own list this years ago and it took two pieces at the time. I hope yours doesn’t but if it does, that’s okay. Down the left side, one item per line, make a list of everything you owe including the dollar amount. Put the amount you pay each month unless it is something that doesn’t have a set amount. These put the total amount you owe. Start with essentials, rent or house payment, utilities, childcare, car payments, etc. Don’t worry about food, gas for the car, and all those things yet. Do your best to give a good estimate of what you pay each month on items that do not have a set amount like the utility bills. Just to help you remember everything: credit card bills, doctor bills, cable or satellite tv, washing machine or other appliance payments, computer payments, car insurance, life or medical insurance, mom, dad, or other relatives or friends you owe money to.
I have a plastic basket that I throw all the statements in. My daughter uses a file in her filing cabinet. The reason I use the basket is mine would end up on top of the filing cabinet anyway. I file them after I pay them but would not be disciplined enough to put them in the front folder on a daily basis when I go through the mail.
Now, go down the margin of the paper and write the due date for everything that has an actual due date. Write the due date, not the late fee if after date.
Next, get a second piece of paper, and rewrite your list, this time in due date order starting from the first of the month to the last of the month. Skip a few lines and add the doctor bills, money owed to mom, etc. When you’re done, put this aside.
This next part seems hard at first, but it will get easier in time. Take out another blank piece of paper. How often do you get paid? Weekly, biweekly, monthly? Write down the left margin, 1, 2, etc. for however many days it is from one pay period to the next. What is the day of the week you get paid? Ours is Friday, so I write F on the first line, Sat on the next and on down for the days of the week. The reason is because my husband is off work on weekends. What I want you to write on this paper is a meal plan. I list one meal a day Monday through Friday, and two on Saturday and Sunday. That is our normal schedule. Yours is probably different.
We live in the Southern U.S. In the really lean years when we were raising our children, I had to feed us as cheaply as possible. Some weeks I would make a pot of ham and pinto beans, with corn bread on the side for Monday and Tuesday, turn the leftover beans into Chili for Wednesday, and then make chili dogs on Thursday.
When you’re done with this, take out another piece of paper.
On this one, write a grocery list based on the menu you just wrote. Estimate the price of each item. If you know or are pretty sure something is $1.79 as an example, round it up to $2. If it is under $1.50 but over $1, price it at $1.50, etc. The reason for always rounding up is to cover the sales tax. If you’re not real sure about the cost, always estimate high. Now add up the total of your list. On the next line start listing and pricing the other things you need to buy. Paper goods, laundry supplies, milk, cereal, sandwich or other items for packing lunches if you do, etc. Total again. Now list transportation expenses like gasoline, or bus fees, lunch money for yourself or your children. Total for the last time. Round this up too. I call this amount F&E for food and essentials. Record this amount on your killer list.
Now comes the fun part. Get another piece of paper. Write the month centered at the top of the page. We get paid weekly. So, I first look at the calendar to see if it is a 4 or 5 paycheck month. I draw a line down the center of the page, and draw one line across the page making a big plus sign if it is a 4 check month, 2 lines evenly spaced across if it is a 5 check month. If you get paid once a month, you won’t need any lines, obviously, and you will only need the line down the center if you get paid twice a month. Next, write the date of the check on the first line inside the boxes you created. Get your killer list. This is like a jigsaw puzzle. Don’t forget to list F&E then the dollar amount on the first line under the date in all the boxes. Fit in your payments, starting at the top of your list. Try to put everything the pay period before it is due. In the beginning you may not be able to, but given time, you will. If you can’t pay all of your rent or a car payment out of one check, split it between two. Estimate your pay amount low if it is not a set amount you are positive you can count on. Add each box to make sure you are under the amount of your check. If not, switch things around until you are. If you have boxes that there will still be money left, add items from the bottom of your killer list. If you are paying something late, or having to make a partial payment, call the people and let them know. This includes friends or family that you have borrowed money from. Call them, let them know you are going to do better managing your finances and tell them when you will be making a payment to them and how much you are going to pay. If something unexpected comes up and you can’t follow through, call and explain.
I feel that we need to stop and talk at this point. Do you make enough to pay all of your bills? If you don’t, first, I’m sorry. I’ve been there too. Bologne sandwiches suck after 2 months of having nothing else, and is not very healthy, but we do what we have to. Could you get a second job part time, find a roommate, a cheaper place to live? Times are tough right now for a lot of people. There is assistance out there to help pay utilities, and food banks to help with food. Don’t lose heart, just live your life one day at a time, and do the very best you can when you get paid.
For those of you who can barely pay everything: I know how hard this is in the beginning. Trust me, it will get easier and eventually everything at the bottom of your list will be paid off, and everything at the top will be being paid on time. No more late fees saves you a lot of money.
One of the awesome benefits of this is not just managing to pay off your debt. What you will find is that when you know when and how the bills are going to be paid, it is a lot less stressful. You will eventually find yourself not thinking or worrying about money between pay periods.
Tip 1. Don’t forget to schedule in birthdays, anniversaries, and holidays.
Tip 2. In your check register, subtract out the partial payments scheduled that you will not be paying until you have the total amount. Example: if it takes 2 checks to pay your rent, write the word rent and subtract out the amount you have scheduled. Next time, write rent back in, add it to your balance, then check it off there and where you subtracted it out.
Tip 3. If you use a checking account, write the checks the day before you get paid, and drop them in the mail on payday.
Tip 4. PAY YOUR BILLS AS SCHEDULED ON PAYDAY! Don’t give yourself the chance to nickle and dime away your money.
Tip 5. If you do not have a checking account and have to deal in cash, money orders, and cashier checks: use small letter size envelopes labeled for rent, etc. and put in them the money for each bill as soon as possible after cashing your check.
I hope this helps.
