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Saving & Budgeting

How to manage your bills: A step-by-step guide

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Getting hit by late fees? You need a plan for paying bills. Learn how to get on top of your payments and avoid costly fees, higher interest charges and dings on your credit report.

Make a list of all your bills: utilities, credit cards and your rent or mortgage payment. Include any other loan payments you have, too. Use an app, spreadsheet or even a notebook; just make sure you can see all of your bills in one place. This will help you keep track of them and can serve as a checklist each month to be sure you don't miss any payments. This list can even become the foundation of a budget if you don't already have one.

It's easier to pay bills when you can find them easily. Set aside dedicated spots to keep your bills — hard copy and digital — so that you can find them quickly when you're ready to pay and can refer back to the ones you've paid.

For starters, always open your bills. If you are behind in your payments, it can be tempting to avoid the reality of your billing statements. Fight that temptation — you don't want to be surprised by late fees or additional payments due. You also want to be sure that your bills are correct. Reviewing your bills regularly can help you spot a fee increase, such as when a promotional rate on a premium add-on expires. That makes it easier to keep expenses under control, too-you can decide sooner to cut it.

It's likely that the bulk of your bills are due on the first or the 15th of the month. Mark their due dates on a calendar. If those dates feel very scattered or fall when your account balance tends to be low, you have options. You can often work with bill collectors to change due dates, so they coordinate with when you receive your paycheck or when you have the most cash available. Bank of America clients can take advantage of email or text alerts for reminders of when bills are due and when payments are scheduled.

You may have a short window between the date your bill is due and when you are charged a late fee. Grace periods are usually about 15 days. This can give you a little more flexibility in timing your bills — but try not to take advantage of it too often. If you're using it every month, you may need to ask about moving your due date. See tip No. 4 above.

Choose a time when you sit down and pay your bills, whether it's once a month, twice a month or more. If you sit down only once a month to make payments, be sure to do it so you are paying bills on time or ahead of time.

To remove some of the stress and time pressure of paying your bills, make automatic bill payments when possible. You may be able to set up automatic payments through your bank, or your biller can deduct the amount of your bill from your account. Either way, automation helps you streamline the bill-paying process and ensures you pay your bills on time. Learn how to set up monthly payments with Bank of America Mobile and Online banking.

Paying bills can be automatic, but that doesn't mean you should forget about it. You still need to monitor the transactions to make sure you have enough money in your account to cover the bills and that no errors are made, such as being charged twice or charged an incorrect amount.

Setting up a smart bill-paying system that supports you month after month takes some work on the front end, but by organizing and streamlining your payment process, you'll ensure you pay your bills on time, every time.

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