Paying a bunch of bills on different days of the month not only takes a lot of time, but it also adds stress to your life and sometimes leads to late payments and fees. “If you have multiple bills to pay each month, there’s a chance they are all due at different times, which may make you feel you’re constantly sending payments,” says Dana Marineau, vice president and financial advocate at Credit Karma. “It’s all too easy to lose track of multiple payments on multiple dates, which is one of the reasons it’s so important to create a budget and stick to it.” She shared five ways consolidating your bill payments can improve your financial health and your life in general. You should also check out these expert tips on how to create a budget.
It makes budgeting more straightforward
If you know you need to pay all your bills on one specific date, you can budget to ensure the funds will be in your account on that day. “To make life simpler or help take control of your cash flow, it may make sense to change due dates on bills to a time that works better for you,” Marineau says.
You won’t pay late fees
It can be frustrating to have to pay a fee, even if it’s relatively small, because you forgot or were late making a payment. Paying all bills on one day allows you to stay on top of every bill and avoid those pesky late fees.
You’ll save time
A few minutes here and there adds up. Not only do you have to sit down at your desk, you have to remember your logins. Doing it on one designated day in a solid block of time is quicker. Paying bills online will make it easy—find out all the reasons you should pay your bills online.
The stress that comes with a mismanaged budget and schedule will go away once you get into a routine of paying all your bills on one day.
Late payments can affect your credit score
Beyond the potential late fees, late payments can negatively affect your credit score, which has a domino effect. Payment history information typically accounts for nearly 35 percent of your credit score, making it one of the single most important factors in calculating your score. Depending on how late your payment is, how frequently you pay late, and what your credit score is, late payments can severely affect your credit—and so can these sneaky things that lower your credit score.
So what is the magic day is to pay all your bills? “Based on when you get paid and when the bills are due, you may decide you want, for instance, all bills due after your last monthly payday so that you can pay everything at the same time, or all your bills due after your first payday so that you can pay them and use your second check for saving and spending,” Marineau says. “There’s no right or wrong way—the key is to figure out your spending and saving habits then find the date that works best for you.” And, to make your bill-paying day better, check out these clever ways to save on every household bill.