Not too long ago, I was listening to my friend Nicole’s podcast over at Living Free in Tennessee. She was talking about the things that she’d done to support her “independence fund”, and she had mentioned that things hadn’t worked out quite the way she’d planned because she was recovering from pneumonia. Then, almost as an aside, she mentioned how she was going to have to pay a late fee on a bill, and it got me to thinking. If I’m paying fees because of cash flow problems or utter forgetfulness, how could I change that to support my family’s independence?
Once I started thinking about it, I felt ashamed. Sometimes cash flow problems can’t be avoided, but losing money to fees because you were forgetful or irresponsible with your money is a hard pill to swallow, especially when you think about how quickly that money adds up.
Here’s the thing though. Feeling shame about things you’ve done in the past doesn’t really help you move forward, does it? Sometimes, that shame and frustration keeps you treading water, and as I’ve said before, if you’re not moving forward in life, you’re being left behind by life.
Learning from past mistakes, making a plan, and then working that plan seems like a much more productive way to move forward, doesn’t it? So here’s what that looks like in my case.
First, I came to grips with the fact that the amount of money we’ve spent in various fees is much higher than I wish it were. Then I asked myself, “Self, why are we paying all these fees? Is there anything we can do to make it better?” And shockingly enough, “Self” had some really good ideas.
- I must be more diligent about keeping the budget updated. I use a spreadsheet to plan and track household expenses, but over the last couple months, for reasons that I still haven’t identified, I got lax about updating the spreadsheet with what we were spending. This meant that I paid some overdraft fees, and that hasn’t happened in ages. At $36 a pop, that hurts!
- I set up auto pay on all my bills that weren’t already set up that way. With the little bit of credit card debt we have in particular, this can go a long way toward preventing fees when you miss a payment date because often times, the late fee costs more than the minimum payment. The “late” payments weren’t impacting credit because they weren’t more than 30 days past due, but they were accruing fees that add up over time.
- I also examined my bills to see if there was a way to avoid service fees by changing the payment method I used to pay a particular bill. For example, some of my kids’ fees related to school (like meals and activities) have service charges related to their payment if I use a credit or debit card. If I use an electronic funds transfer from my checking account though, those charges are less or they’re waived altogether!
Of course, there are a myriad of other ways to increase my family’s financial freedom, but with this post, I wanted to share some “low-hanging fruit” in case there are folks out there hadn’t thought this way in their own journeys. I didn’t want to make the mistake of assuming that everyone thinks the way I do; assuming gets us into trouble!
What we do matters!