How far ahead are you on your bills?

[RamblingMad]

Ah yeah none of the loans I've had make extra payments to principal. You have to specify that. An extra payment would just apply to the whole balance which included interest but wouldn't necessarily reduce your payment due or loan term. One of my student loans I learned the hard way to apply a payment after my payment EFT'd. If I made an additional payment before the payment had EFT'd it just wouldn't draft that payment owed which wasn't really my point of applying an extra payment lol.

Same. If it's being applied to a future payment, folks are still paying the same interest. They're just paying it early, which I can't wrap my head around. I had to explain the idea of paying ahead versus paying down principal to my sister. She didn't understand that if you paid ahead, you paid the same interest.

 

[MrsPete]

you have to be VERY careful with any 0% interest loans with paying ahead.

Make that "you have to be very careful with ANY LOAN", and I'll agree. Loan details vary widely, and it's up to the individual consumer to read everything and know what he or she is agreeing to pay back.

As for 0% interest ... be suspicious. No company is going to loan you money for free. They're charging a premium price for their product, or they're writing in a "gotcha clause" of some type (for example, pay a bill late, and they'll zing you big), or they're getting paid some other way. The 0% interest loan might be worthwhile, but be sure you know how they're getting paid. You don't want it to be a surprise.

 

[MillauFr]

I'm not ahead on anything, but I'm also not behind on anything. I just schedule the bills to be paid on their due date.

Exactly what I do. I though most people did this. Just schedule the bills to be debited on their due dates.

 

[tvguy]

Exactly what I do. I though most people did this. Just schedule the bills to be debited on their due dates.

I have one bill like that and it has been a HUGE pain because the due date didn't always sync up with paydays. I only do that because I get a discount by having it auto paid. I will have to rethink that now in retirement with no paychecks coming in and living off savings. I like to look my bills, because once in a while they make a mistake, and I sure don't recall them UNDER billing me. I don't want to mess with trying to unravel an incorrect bill that was auto paid.

 

[tzolkin]

As for 0% interest ... be suspicious. No company is going to loan you money for free. They're charging a premium price for their product, or they're writing in a "gotcha clause" of some type (for example, pay a bill late, and they'll zing you big), or they're getting paid some other way. The 0% interest loan might be worthwhile, but be sure you know how they're getting paid. You don't want it to be a surprise.

Correct. Most 0% purchase offers (like furniture or appliances) that involve taking out their credit card still have the interest accruing (at a huge percentage) so if you do not pay off the full balance prior to the end of the promotional period, you would be responsible for ALL of the interest.

With 0% interest car loans, there is a flat fee (like $750 or $1000) that is added to the total purchase price. We were considering taking a small loan when we purchased our last car and were offered a 0% interest loan through the manufacturer. I pulled out my phone and looked up the amortization table for a 3% loan. For the amount we wanted to finance, it was actually cheaper to pay 3% interest than the flat fee with the 0% loan. My husband commented and the finance guy said, "Yeah, people don't do math".

 

[Shelly F - Ohio]

I just have money direct deposited into a savings acct each payday so there is always money in the emergency fund acct. Pay the bills as the come in while putting money in the bank. Also if you dont have an emergency fund and something terrible happens you will have the money on hand and have not paid money ahead on bills that could be used for the emergency.

 

[Judique]

dvc- my maintenance fee I have it set up monthly. When I get everything else to a year than I might change this.

I have mine set up monthly as well. I collect gift cards that are discounted to pay the dues before they take the money from my account. I can usually get between 10 and 25% in discounts - no less than 10% so far.

 

[Judique]

Some of these make sense. Our water bill used to be quarterly but is now monthly, so we just pay what 3 months would have been to save the stamp 3x

There are all kinds of different ways to make or save a few bucks. My electric company allows paying ahead but charges a fee for credit cards. The fee is $1.75. So I pay the maximum of $600 for $1.75 on a 2 % cash back credit card. I 'earn' $12. minus the $1.75 or $10.25. Checking or savings does not pay that on $600 if I were keeping it in my account. My provider is a 'direct' provider so unless I decide to change to another company, it's highly unlikely I'll have any problems using my credits.

In addition, my electric bill shows a detail online of what was owed, what was paid and the amount of credit I have on the account. They also project what my next bill will be based on usage, and they correct it each week, so that I have an excellent idea of what my bill will be and whether I have credit remaining.

There is also the ability to do budget billing with the same amount paid each month and a reconciliation once per year.

My gas bill and water bill allow payment by card but do not accept additional payments in advance. Water bill comes every three months and gets paid by 2% card, which results in a small profit of $2-3 each time. Gas bill gets paid by credit card but does not charge for accepting a card.

Credit cards are always paid in full each month. Paying insurance yearly or biannually results in a few dollars of savings.

And, cash available through checking and savings is intentionally kept low. Any larger expenditures can usually go through a card, giving a grace period to move cash from a higher interest investment vehicle if necessary.

 

[Judique]

I don't have any bills that I have to mail something in to pay, all is done online. If it's not autopay, like DH's medicare premium, I go online to pay it. Some come directly out of my checking account, some go on a credit card.

I don't do autopay for my Medicare premium as I'm always plotting which card to put it on to get the most bang for it. And I also pay it online now since they've started allowing that.

 

[CookieandOatmeal]

I don't do autopay for my Medicare premium as I'm always plotting which card to put it on to get the most bang for it. And I also pay it online now since they've started allowing that.

You can pay your Medicare premium online with a credit card now? I’ve been helping my mom pay hers directly from her bank account but will have to look into this for next time.

 

[tvguy]

You can pay your Medicare premium online with a credit card now? I’ve been helping my mom pay hers directly from her bank account but will have to look into this for next time.

Not sure if it's new, but you can pay with a credit card. https://www.medicare.gov/your-medicare-costs/ways-to-pay-part-a-part-b-premiums/online-bill-payment

 

[Judique]

You can pay your Medicare premium online with a credit card now? I’ve been helping my mom pay hers directly from her bank account but will have to look into this for next time.

I've been using a credit card for it from the start for 3 and 1/2 years now. At first I used the paper billing to mail it back and would write the card info on the paper. Then they started allowing you to set up an online account and pay it online maybe a year ago. So much easier! At some point I will start collecting social security and they will deduct it (I think) but it's no big deal to pay it every 3 months online and has helped with meeting an occasional msr since I really don't have very many expenses.

 

[CookieandOatmeal]

I knew about paying with a CC using the paper mailing which seemed like a hassle. I’m used to doing everything online. She does have an online account so I’m going to poke around to see where the CC option is.

 

[Judique]

I knew about paying with a CC using the paper mailing which seemed like a hassle. I’m used to doing everything online. She does have an online account so I’m going to poke around to see where the CC option is.

Yeah, it was a hassle using the paper mail in option. I had to watch my account closely to make sure it was paid on time and on one occasion, I was worried enough to send another payment through bill pay, meaning I paid double for one period. They just applied it to the next period but it was stressful. Then, shortly after, I was able to set up my online account for the CC payment. You don't want to miss a deadline on any Medicare payments.

 

[CookieandOatmeal]

Yeah, it was a hassle using the paper mail in option. I had to watch my account closely to make sure it was paid on time and on one occasion, I was worried enough to send another payment through bill pay, meaning I paid double for one period. They just applied it to the next period but it was stressful. Then, shortly after, I was able to set up my online account for the CC payment. You don't want to miss a deadline on any Medicare payments.

I agree about not wanting to miss a deadline. My mom would’ve been so stressed out which is not worth any CC points.

 

[barkley]

I knew about paying with a CC using the paper mailing which seemed like a hassle. I’m used to doing everything online. She does have an online account so I’m going to poke around to see where the CC option is.

does she get social security? if so is there a reason she doesn't have it directly paid by social security from her social security check each month? it only takes a phone call to set it up. it takes about 2 months for the process to kick in-month 1 you still get a bill while they run a trial draft (no actual money) to ensure they are set up correctly, and then in month 2 the premium is pull from your social security check before it's direct deposited (or in really rare cases-mailed).

 

[CookieandOatmeal]

does she get social security? if so is there a reason she doesn't have it directly paid by social security from her social security check each month? it only takes a phone call to set it up. it takes about 2 months for the process to kick in-month 1 you still get a bill while they run a trial draft (no actual money) to ensure they are set up correctly, and then in month 2 the premium is pull from your social security check before it's direct deposited (or in really rare cases-mailed).

She’s waiting to collect at 67.

 

[Judique]

She’s waiting to collect at 67.

I may collect at 69 or maybe wait until 70. Hopefully I'll be around long enough <grin> to make the wait worthwhile. People are living longer these days.

 

[ICF]

This just doesnt make sense to me. Unless “paying ahead” is going to save you interest (mortgage / auto / other loan….why would you give it to a company before the provide a service. Just keep it and earn your own interest.

 

[nycdisneygal]

Made an extra payment to mortgage about equal to 3-4 months. Have been gettting way ahead on school loans during this no interest payment and am almost done after 19 yrs! And really the bulk of it was still unpaid as of 5 yrs ago- thats when I started really working hard to make extra payments).