For Kate & Trudy readers only, use the discount code SEEGREEN19 for 25% off your Household Finance Kit purchase.
10/1/2018 UPDATE: The kit has been updated for 2019 and does not look exactly as shown in this blog series (very close, but slightly adjusted / improved). It’s been updated and 5 new pages were added! Thank you for ALL of your support! I’m thrilled to see so many users of this great budget planning method.
Welcome to Part Two of the Household Finance Binder Series. If you missed Part One ~ Create Your Binder, make sure to catch up first before continuing on.
Today we’re entering your financial data and establishing the bill payment process. Next week we’ll focus on budgeting. Stick around by following on BlogLovin’ – I promise it’ll be worth it!
Before we begin this week and as a reminder, I’m featuring the Household Finance Kit in this series and it’s available in my Etsy shop as an instant download. Start your own household finance binder *today* if you wish!
ENTER YOUR FINANCIAL DATA
>> If you haven’t already followed the steps of Part One, please do so before proceeding. Purchase and download the Household Finance Kit from the Kate & Trudy Etsy shop using the discount code above for 25% off.
>> Flip to the Bills tab first. Here you’ll find your Bill Schedule page to fill out. Complete a line for each and every reoccurring bill. The first 4 columns can be filled out right away. Review your check register from the last year and credit card bills (if applicable) to make sure you’ve gathered all reoccurring bills. In the “Notes” column all the way to the right, use it to identify if the bill ends up on your checking account or credit card or track anything else you wish here.
>> Next, hop to the Monthly Calendar and label every scheduled payday however you wish. I’ve used silver stars and/or markers to outline the day. We’re only labeling income we’re expecting with certainty.
>> Also on the Monthly Calendar, label every reoccurring bill from your Bill Schedule that is 100% confirmed to be payable during the month. Your mortgage, cell phone bill, etc. will be definite. Your Nordstrom credit card might not be definite. This is as easy as writing the name of the bill and adding the amount (if known) or just a currency sign as a placeholder for the amount when known.
>> Feel free, at this point, to add details regarding your investments in the Investments tab if you created one.
ESTABLISH YOUR BILL PAY PROCESS
Now that your binder is setup and your Bill Schedule and Monthly Calendar are filled out, we can move on to the process of actually paying the bills! I’m outlining the process that works for me and the Household Finance Kit structure, but if you desire to implement another process, by all means, please do!
>> First, decide when you’ll pay the bills. Twice monthly? Once a month? Add the date(s) to your calendar with a gold star maybe or highlighted border just like the payday. Make sure to transition this date to your daily/weekly planner so you don’t forget.
>> Now, let’s start with your paycheck, since you can’t pay the bills without the income! When you sit down to pay the bills and you’ve received a paycheck from an employer, reimbursement from a friend, etc. head over to the Income Record to record it.
Why are we tracking this separately? Isn’t it on the Check Register?
The answer is “yes,” it’s on the Check Register. However, I feel it’s important to have all income tracked in one place to review. Looking at income sources and amounts is as important in managing finances as reviewing and paying bills, in my opinion!
>> Speaking of the Check Register, go ahead and make sure it’s up to date with the income received, any autopay bills or transfers to savings. Double check the balance with your online bank account, if applicable, before starting to pay your bills. There’s not much worse than an overdrawn account! Mark any cleared bills, checks, or income on the Check Register.
>> Now that we’ve addressed your income, it’s time to address the bills that are payable. Take all bills/receipts and confirm that the amounts and due dates appear on the Monthly Calendar. If they don’t, add them. For all the bills being paid today, put a check mark next to the name on the Monthly Calendar.
Note: Autopay bills going to your master credit card do not get a spot on the Monthly Calendar. Only the master credit card gets added here (otherwise it’s shown twice)! Autopay bills going to your checking account should get a spot on the Monthly Calendar. Since money will be removed from your account for checking account autopay bills, it’s important to remember!
>> Head over to the Check Register again where you’ll enter the transaction details. If you write a check, write the check and seal the bill envelope. If you’re paying bills online, just record the details here.
>> Store the bills and receipts in the Receipts tab of your binder once paid.
…and, just like that, you’re all done with paying your bills until the next time! Store your binder in a safe place in the meantime. Next week we’re reviewing how to budget to maximize our net worth and control spending!