In today’s fast paced, smart phone world, using the best financial tool is essential to protecting your bottom line.  The good news is that there are effective financial management tools that are as intuitive and easy to start.

Implement these two tools right away.

Tool #1: Pay your monthly bills on the 10th and 25th of each month.

Although this is idea is not new, the practice has given way to the immediate gratification mentality.    Our smart phone allows us to pay bills with a few clicks while waiting to pick up the kids. That’s nice, but for money management, a better tool than your smart phone is a decision to pay your bills just twice a month.

Regularly sitting down on the 10th and 25th reduces the possibility of missing a due date and incurring late fees.  The risk of spending money that’s been authorized to pay out, but hasn’t cleared, is virtually eliminated.

Those trapped in a vicious cycle of “money in – money out”  gain control by reviewing their situation regularly.  It’s a better feeling when you pay your debts on your own terms.

Get Started.

To start the 10th and 25th bill pay system,  take a good look at all of your bills. Don’t forget automatic payments and e-bills.    List out your creditors and due dates and sort into two lists based on the dates.   Mark the 10th and 25th (or the closest dates that work for you) on your calendar.    You are now the manager of your money and not a slave to your creditors.   For a more detailed explanation on this system with a free chart to use, go to:

Tool #2: Have more than one bank account.

You know the adage, “don’t put all your eggs in one basket.”   Sure, you’ve heard it used in investing,  but did you know it’s a real game changer when applied to personal finances?

Most of us open a checking account and maybe a savings account and think we’re good.  But putting all earnings into one fund creates a problem.  Day to day expenditures are drawn from the same account that our monthly fixed expenses are paid.  It takes a certain amount of discipline to not overspend at the grocery store in order to guarantee the electric bill will not bounce.

The solution.

Here is another simple solution.  Reorganize your accounts so that you have at least 2 checking accounts.   One account for fixed monthly expenses, ( utility bills and loan payments) and another account for variable expenses and discretionary spending, (food and fuel and other shopping).  These accounts can be in the same or in different financial institutions.  Compare terms with your local banks and credit unions to avoid extra fees.  Then adjust your direct deposits to allocate a certain amount to each account.

This simple tool facilitates bill paying (which we do on the 10th and 25th) and greatly reduces the risk of an overdrawn account.

Marriage saver.

This tool works well when there is more than one pay source.  Couples who split expenses of a shared household  contribute their determined portion of the bills to the designated account and are free to decide how the remainder of their money will be allocated.   Once the initial agreement on allocations is made, arguments over money are lessened. Financial peace is attained for all because we know our basic needs are met.

Conclusion and Summary.

Money management is a verb, something we do.  Tools help us do what we need to do more easily and effectively.  I hope you feel that you could use both of these tools to gain control of your finances.

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