30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances

Chapter 5. Create a Bill-Paying System

During the recent financial crisis, I worked with a local television channel to provide on-air financial coaching for families who needed it. In the course of that project, I counseled a thirty-something couple who, in most important ways, had it all together: two good jobs, two beautiful young daughters, a great extended family support system, and a condo in a desirable neighborhood of Chicago.

They needed help, though, with the details. Although they were comfortable, not rich, they routinely dropped several hundred dollars a week on restaurant and carryout meals, and they were paying for two health club memberships that they didn't use. They also admitted to having a hard time keeping track of their bills, sometimes incurring late fees for not paying on time. Their lack of attention to details was hindering their ability to get ahead financially, despite the fact that they earned two good paychecks.

Curbing a tendency to overspend can be tough, particularly when habits such as the daily latte are so ingrained. At the end of our meeting, I walked away not completely sure that this couple would implement most of the spending cutbacks I recommended.

But I hope that I got through to them on the subject of paying their bills on time, because doing so would arguably have just as big an impact on their financial well-being as reducing their spending. Although the $15 late charge on their Sears credit card seemed innocuous to them and was a drop in ...