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Plan Well, Retire Well

Looking for new ways to make bill payment painless

Women holding her head and looking at table with bills

I hate to pay bills and I’m always looking for ways to make it less painful. I used to be able to pay bills just once a month – after payday – and this seemed to work to keep my bills on time. However, that doesn’t work for me now. Now I don’t have a good system – especially in terms of when to pay the bills, and I’m looking for new options.

After managing our family’s bill payment for quite a while, I have a good understanding of our cash flow. Luckily, our family income is relatively predictable. Unfortunately, this isn’t true for many households. According to the recent “Report on the Economics Well-Being of U.S. Households in 2019 – May 2020,” three in 10 adults had family income that varied from month to month, with higher rates of volatility among workers in the construction or leisure and hospitality industries.

Income volatility can make it especially hard to pay bills on time. And, as we all know, expenses have a way of being unexpected! While we can predict some expenses (like rent and food) based on past months expenses, other expenses (like medical and car repairs) aren’t as easy to predict.

While I was exploring and pondering my bill paying angst, I learned about a new way that some employers are allowing their employees to access their wages: instapay!

Instapay allows the transfer of funds almost immediately and some employers are now using it as one way that employees can receive their wages. What this means is that after working your shift for the day, you can receive your wages right away – rather than wait for the paycheck day. In other words, you receive your paycheck early – or at least part of it.

What are the possible advantages of instapay for wages?

  • The flexibility of being able to access wages early may mean that people are less inclined to borrow money from high-interest loan options to pay unexpected expenses.
  • People may also pay less for overdraft fees.

What are the possible disadvantage of instapay for wages?

  • People may spend more on discretionary items and then not have enough money left in their paycheck for needs like rent or mortgage payments and food.
  • Research shows people tend to underestimate how much we spend. (Read more about this at NextBillion)

In our latest Family Financial Feuds podcast, “The One Where: Kathy Hates to Pay Bills” we had a lively debate about these pros and cons.  Take a listen on Soundcloud, Google Podcasts, and Apple Podcasts to see whom you agree with!

If you do use an instapay app:

  • Check on whether or not the app you use (which varies by employer) charges you fees and how much are the fees.
  • Know how much you need for important bills each month and plan for this.

My employer doesn’t provide an instapay option. However, I am thinking about whether or not I want to pay bills as they arrive (by mail or electronic) and not wait until “bill day.” Maybe that would make it less painful for me. Or, maybe it would just make me grumpy more often!  Clearly, I need to do more research and ponder this a bit more.