Pay Bills the Easy Way
With the Organized Folder

I have found a simple solution for paying bills that I call the Organized Folder. I keep my bills and the paperwork that goes with the bills nicely organized. I keep all the bills I get in the pockets in a folder that has multiple pockets.

The one I have my ex-wife found somewhere. It is an actual bill paying folder and it works very well. If you can't find one you could use one like the kind you used to have in school.

I keep stamps, return address stickers, envelopes and all the bills I receive and have not paid in the organized folder.

As bills come in I throw away the envelope they came in and any extra papers in the envelope such as advertising. I can't stand keeping the envelope that the bill came in. It just doesn't make any sense to me. A lot of people do make the mistake of keeping the envelope that the bill came in. That is why I am reminding everyone that it is ok to throw the envelope out. There are plenty of envelopes and paper in the world.

I am then just left with the bill and the return envelope. Sometimes the bill has multiple pages that I immediately staple together. I put a stamp and either write the return address or place a return address label on the envelope. I then place the the bill, fully opened, into the return envelope. I use the envelope like a paper clip on the left hand side of the bill.

Then I put the bill and prepared envelope (stamped, addressed and with my return address on it) in the correct pocket in the organized folder.

I note the name of the bill, amount due and date due in a 5 inch by 7 inch pad I keep in the first pocket of the folder.This is an example of how it looks:

Elec. $123 5/29/11

Heat $61 5/27/11

MasterCard $32 5/15/11

Car Ins. $57 5/22/1

This way I can tell, by glancing at the pad, what is due, when it is due and the amount of money I need. I don't make an elaborate chart or put it on the computer. I just want it to be simple. What the bill is, how much it is and when it is due.

By dealing with the bills as soon as I get them I only need a few minutes to keep the organized folder in order. Then when I sit down to pay the bills, usually after a payday, the envelopes are ready and I can just drop them in the mail.

Obviously, it is even simpler to just pay the bills as soon as you receive them but I don't think that works for most people.

I have the pockets in the folder set up as shown below:

1. First pocket. Stamps paper clipped to the pocket. Return address stickers. A handful of full sized envelopes. A 5 inch by 7 Inch pad for noting the bills as I describe above.

2. Second pocket. Mortgage or rent bills.

3. Third pocket. All credit card bills.

4. Fourth pocket. Electric, heat, cable TV and water bills.

5. Fifth pocket. Telephone, cell phone and internet bills.

6. Sixth pocket. Insurance bills.

7. Seventh pocket. Any other bills.

Just add whatever other category that you need like car payments, student loans or installment loans or organize it in a way that makes sense to you. If you have a lot more bills than these then you have too many bills! You would want to get some of those bills paid off so you do not have so many to deal with.

When I sit down to pay the bills, I grab the organized folder, checkbook, a pen, calculator and a highlighter.

I write the checks, put them in the envelopes and seal them. I write the amount I paid, date, and check number on the part of the bill I keep. I circle this information and highlight it also. This paper gets filed. Each bill has its own manila file in my file cabinet.

This system works whether you pay each bill as it comes in, every week, every 2 weeks, every month or any combination of payment schedule that works for you.

It works because paying the bills is one task. You are keeping all the items together as one task until the bill is paid. Then you file the bottom part of the bill away.

One option that I have used at times is to keep the part of the stub in its pocket until you get the next months bill. Then you can verify that they received your check.

The organized folder system will work for everyone. Give it a try.

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