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How to Organize Your Bill-Paying Process

Eliminate Late Payments, Penalties and Higher Interest Rates


Bill-Paying Station

Organize your bills by creating a bill-paying station.

Photo by: Sue Kay

The Problem: A Disorganized Bill-Paying Process

In addition to our many other responsibilities, many working moms also take on the job of paying the family's monthly bills. For some of you, this might be one of your least favorite tasks. It is, however, an important one.

Without an organized system for paying bills, payments can be late or missed all together resulting in late fees, penalties and higher interest rates. Late payments can also ruin your credit.

The Challenge: Organize Your Bills In One Hour

Take one hour this weekend and get organized. Use this step-by-step solution to organize your bill-paying process and keep it organized.

Tools Needed to Organize Your Bills

  • Computer (optional)
  • Set of plastic or cardboard drawers
  • Trash can
  • Paper Shredder (optional)
  • Red Pen
  • Notebook
  • Highlighter
  • 10" x 13" Envelopes
  • Stamps

Step One: Create a Bill-Paying Station

Paying bills will be quicker and easier if you have a specific bill-paying station established. It doesn't have to be a large space: a small table in the corner of your kitchen, a shelf in your home office, or simply a basket to hold your bill-paying tools and supplies.

Step Two: Organize Your Paper Bills

Many of our monthly bills still come in the mail. Process your paper bills as follows:

  • Open them as soon as they arrive. Using a red pen, make note of the due date and the amount owed on the front of each envelope. Pay close attention as due dates are not always the same each month. 
  • Highlight any charges or parts of your bill that you question. You'll follow up on these issues later. 
  • Throw away any envelope stuffers that don't include any personal information (special offers or promotions for other products).
  • Shred - did you receive any checks along with your credit card statements? Don't ever throw those away. Either store them in one of the drawers if you want to keep them, shred them or put them in a 10" x 13" envelope marked "to be shredded." If you don't have a shredder, many office supply stores offer access to shredders for a nominal fee.
  • Store your unpaid bills in the top drawer of your plastic or cardboard drawer system.

Step Three: Organize Your Electronic Bills and Statements

With greater frequency, we're receiving monthly bills and credit card statements electronically via email. Organize your electronic bills and statements as follows:

  • Establish a separate email address just for electronic bills, bank statements, investment statements, etc. This will ensure that an electronic bill doesn't get overlooked in the midst of the many emails you receive.
  • View online bills and statements as soon as you receive email notification that they are available. Confirm that you are in agreement with all of the charges and the amount due.
  • Make note of discrepancies - print out the document, highlight the discrepancy and place the paper in the top drawer of your plastic or cardboard drawer system along with your unpaid paper bills. If you don't have access to a printer, make note of the issue in your notebook and place the notebook in the same drawer. You'll deal with any discrepancies later in this process.
  • Forward each email notification to your own email address changing the subject line to read: entity owed, due date, amount due. For example: GA Gas, 6-28-2011, 78.00.  
  • Create an electronic email folder for each month and year: Online Bills - January 2011.
  • File it - after you've reviewed each online bill and forwarded it to yourself, file it electronically in the monthly folder you created.  

Step Four: Schedule a Weekly Time to Pay Bills

Schedule 30 minutes each week to pay bills. Block this off on your calendar just as you would any other appointment. This is also a good time to review your online bank account for accuracy.

Go to your bill-paying station:

  • Remove the paper bills from your to-be-paid drawer.
  • Log on to your computer.
  • Open this month's electronic to-be-paid folder.
  • If you highlighted any questions or discrepancies, make calls to these institutions first. More and more companies are accommodating working professionals and have customer service agents available until 8 p.m. EST. If you can't reach anyone, add this task to your to-do list for the next day. Make note of your account number, the customer service phone number and your specific question.

Step Five: Pay Your Bills

If you want to organize your bills efficiently and effectively, you need to consider online bill payments.

According to Banking/Loans About.com Guide Justin Pritchard, there are two types of online bill pay options:

  • Online bill pay offered by your bank;
  • Online bill pay offered by your service providers (phone company, mortgage company, etc).

Here, Justin answers the question:

How Do I Set Up Online Bill Pay?

While it may take you a little longer to initially set up online bill payments; you'll save lots of time during each subsequent month by paying your bills online.

In both online bill-paying scenarios, you'll be given a confirmation number as part of the transaction. Make note of this information either on the bill itself or keep a master list of monthly transactions in your notebook.

If you are not paying some or all of your bills online:

  • Write out your check;
  • Record the transaction in your check register;
  • Use the return envelope provided in most bills and statements;
  • Stamp the envelope;
  • Be sure to factor mail time into your process. Allow 7-10 days for mail delivery and payment posting;
  • While you won't have a confirmation number, you should still make note of the transaction on the bill itself or on your master list of monthly transactions. Make sure to also include your check number.

Step Six: File Them

Create a 10" x 13" envelope for each month. Once you're done paying the bills, place the paper copies in the appropriate month's envelope along with your master list of transactions (that will also include information on the bills you receive electronically).

If any of these bills are needed for tax purposes, make a copy and file it with your yearly tax documents.

Step Seven: Ongoing Maintenance

You can keep your bills organized by following the steps outlined above on a consistent and regular basis.

By doing so, you'll save time and money.

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