STEP 3 Setting Up Your Bill Organizer Keeping track of your bills each month can be a headache. How to organize your bill paying and keep track of those receipts, canceled checks, loan papers and other important paperwork isn’t easy and isn’t fun. This section is designed to make that job easy. I can’t do anything about making it fun. Below is a list of supplies you will need: 1 - Three Ring Binder 1 ½" 3 - Document Protectors(Designed to insert in 3 ring binder) 15 - Pocket Dividers SETUP Step One: Open your three ring binder. Insert your pocket tab dividers. In front of the pocket dividers, place 1 Write on Tab Divider. The Write on Tab Divider is designed to provide support while you are writing on the Monthly Bill Summary. Step Two: After you complete your Budget as outlined in the text, label the dividers. Start by labeling the first divider, Bills to be Paid. Then label the rest of the dividers with the names of your bills. See the below sample: Divider Tab's Labels Bills To Be Paid House Payment Car Payments Utilities Telephone Continue this until you have a divider for each bill. If you don’t have enough dividers I suggest that you combine similar bills. This could be all car payments, utilities or credit cards. Step Three: Place your Budget Form, Monthly Bill Summary and Page 2 of the Monthly Bill Summary in the document protectors. Then place them in the three ring binder in this order: Monthly Bill Summary (this will be the first form you see when you open your binder) Budget Form Monthly Bill Summary Page 2 USING YOUR BILL ORGANIZER Step One: Gather all of your bill statements and payment books and place them in the pocket divider labeled Bills to be Paid. This is where all the bills are to be placed when you receive them. Step Two: On payday, look at section 2 of the Monthly Bill Summary to determine which bills need to be paid that payday. Write out your checks for these bills and get them ready to mail. On the statement for each bill or in your payment book, write the check number and date paid. Step Three: File all statements in the pocket divider corresponding to that bill. When you receive your bank statement and after you reconcile it, also put the canceled checks in the pocket divider corresponding to that bill. File any correspondence in these pocket dividers. When you have The Complete Budget and Bill Organizer setup and start using it regularly, don't be afraid to make changes. Try to put as much away in savings as you can afford. Your Crisis Fund is the key factor in making your budget work. It is designed to eliminate the use of credit cards for unexpected bills. If you use credit cards and don't pay them off each month, that this is one of your major expenses. OTHER IMPORTANT FILES First, there are really four types of files. Personal (bill receipts, etc), tax files (any paperwork that is required for taxes), long term files (mortgages, car contracts, or any other contract) and important papers (will, birth certificates, etc.) Personal files are the files mentioned in the Bill Organizer. At the end of the year, if the files aren't too thick you can consolidate them into one folder labeled with the year. Examples of things in this category are: monthly insurance statements, credit card statements, mortgage receipts, and any other monthly statement. KEEP THESE RECORDS FOR TWO YEARS. Tax files can be filed in a folder or accordian folder. These items include: W2 forms, 1099 forms, All tax forms with attachments and any other form that you receive that must be reported on your taxes. KEEP THESE RECORDS FOR THREE YEARS. It is best to keep your previous years tax forms plus the three years before that. The IRS only audits back three years. You can destroy older files. Long Term files include your mortgage or lease agreements, notes on car purchases or any contract that is still in effect. Keep these files in a safe place. KEEP THESE FILES AT LEASE UNTIL THE AGREEMENT HAS ENDED. MY SUGGESTION IS TO KEEP THEM FOR FIVE YEARS AFTER THE AGREEMENT HAS ENDED. Important papers should be kept together where you can lay your hands on them quickly. You might want to use a safety deposit box or at least a locked drawer. These items include: wills, deeds, trusts, stock certificates, birth and death certificates and any other extremely important document. KEEP THESE FILES INDEFINITLY.