Financial Literacy Handbook

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Paying Bills

Paying bills on time is one of the most important money management responsibilities. Late payments can result in expensive fees and damage to your credit. Thanks to online banking, it’s never been easier to manage bills and pay them on time.

Most local and Internet-only banks offer free bill pay, which allows you to pay any company or individual with the click of a button. If a company you want to pay accepts electronic payments, your funds will transfer electronically. If not, the bill pay service prints and mails a paper check on your behalf to any payee in the United States that has a mailing address.

E-bills and e-statements can be sent to your e-mail, bill pay center, or both. You can set up a bill to be paid automatically on a certain date and e-mail you when the transaction is complete. Or you can log on to your bill pay center and manually initiate a payment for up to one year into the future. You can set up reminder alerts for all your recurring bills so no payment due date ever falls through the cracks.

Tips to Manage Money Like a Millionaire

One of the most surprising facts about wealthy people is that most of them weren’t born that way. About 80% of the wealthiest people in the United States are first-generation millionaires. They accumulated wealth by working hard and saving and investing money. That means anyone who is disciplined with his or her money can achieve financial security. Here are 10 tips to manage your money like a millionaire:

Live below your means. Spending less than you make is a choice. Saving money, and not overspending, is how you build wealth.
Know where your money goes. If you don’t have a spending plan to track your money, you won’t know if you’re making wise decisions. Getting ahead financially starts with taking control of your cash flow.
Create an emergency fund. Having money set aside for unexpected expenses is a safety net that you should never be without. That’s how you’ll make it through a financial rough patch, such as suddenly losing your job or having large unexpected expenses. Make a goal to accumulate at least six months’ worth of your living expenses to keep on hand at all times.
Focus on net worth instead of income. No matter how much you earn, you can grow rich by slowly increasing your net worth over time. But even if you have a large income, you’ll never grow rich if you don’t get in the habit of setting aside money for the future.
Have long-term financial goals. Wealthy people know what they want to achieve and then work backward so they have a plan for what to do each year, month, week, or day to stay on track and meet their goals. Set objectives to achieve your goals.
Begin saving for retirement early. If you think you’re too young to start saving for retirement, think again. Creating wealth for your future rarely happens overnight—unless you beat huge odds by having a winning lottery ticket or a big inheritance.
Save and invest at least 15% of your income. Make it a habit to save 15% to 20% of your income, starting with your first job, and adjust your lifestyle so you can easily live on the rest.
Automate your savings and investments. It’s easier to save money that you never see. Participate in a workplace retirement account or have your paycheck split between a checking and savings account so your savings are on autopilot.
View money as a tool. Money is only as useful as what you do with it. So decide what’s important to you and use money to achieve your needs and your dreams. Push away short-term gratification in favor of important, long-term goals like saving for retirement.
Realize when you’ve made a money mistake. Everyone makes mistakes with their money from time to time. If you overspend or make unwise decisions, stop and make the choice to get back on track right away.