How Do You Prepare Financially for a New Month?
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Well, one month is about to end and another one to begin. I don’t know about you, but there are times when I feel most months just fly by. They start with little fan-fare and then blaze by with little notice. Being the planner that I am, I like to have my month planned out financially to understand where I am and where I am going. This is going beyond the budget and thinking about other parts of my financial life as well. I wanted to share with you on how I prepare financially for a new month.
My First Step to Prepare Financially – Scan the Budget
The first step I like to make for each month is to scan my overall budget. Do I have everything in place for the new month? Do I need to make any changes? This is my chance to see if I have been staying on my budget path or if I have strayed. I think it is important to look over your budget each month and make sure you have your numbers correct. No matter if you budget to strict numbers or you have a loose budget, take the time to look it over and make any necessary changes.
Set Up My Payments
This might surprise you, but I don’t have any automated payments. I have never been a fan of them and have seen so many issues with them when I worked at a bank. Yes, setting up payments each month can be a pain, but this way I know they are going to be paid. I used to do automated payments, but then faced technical glitches or double payments being sent. No thanks! I will take the extra 10 minutes per month and setup my payments. Since I have quite a few bills due on the 1st of the month, I typically set these up when the new statement comes out.
Audit My Accounts
Running an account audit is really important. This is much easier to do when you have a service like Mint or Personal Capital. Not only do I audit my bank accounts and credit card accounts, but I also audit my service providers. Are they charging me more? Have they calculated everything properly? I have seen a few times here and there when a service provider will bill me the wrong amount or add an extra fee. You have to be vigilant with your accounts and make sure you are not overpaying for anything and that no money is mysteriously missing from your bank.
This only happens when I have a contract about to expire or renew. I look over my services and see if I can get a better price. If my car insurance is about to renew, I call them up to see if there are any new discounts. If there aren’t any, then I go to other providers to see what they can offer. Sometimes you find some savings, sometimes you don’t. I never like to just stick with one service because I am comfortable. Being comfortable tends to lead to higher prices. I don’t like higher prices, so I take the extra time to make sure I am getting the best deal that I can.
Check My Credit
I am an advocate for checking and monitoring your credit on a regular basis. I have started doing this on a monthly basis. When my services update my credit report, I want to see if there is anything out of the ordinary. There are some great ways to monitor your credit for free, so making the excuse that this costs money doesn’t fly. It can be very exhausting to deal with problems on your credit. It only takes a split second to have someone mess up your credit, but it will take some time and effort to get it fixed. It is always better to catch it early. The great thing is that some credit cards, like the Barclaycard Arrival World Mastercard, are starting to offer your credit score for free each month. You just log into your account online and it displays your score.
I don’t really pay myself first like many advocate. While I do have automated transfers setup into my savings accounts, I don’t put money into those accounts right when I get my paycheck. I consider my savings a monthly bill. At the end of each month, I will check to see how much extra money I made. I will see what my upcoming expenses are going to be, and then I pay myself. When I have extra money, I like to sock it away. Yes, I could spend it, but I like to save. If there is anything extra that was unaccounted for, then it goes into my savings account or my investment account. Either one suits me fine, but it will depend on if I need money soon or would rather wait until retirement.
How do you prepare financially for a new month? Is there anything that you do that most probably don’t? Have you ever been burned by not preparing financially?
Photo courtesy of: reynermedia