You want to invest early and pay your bills later, but on time. However I realise that many people always procrastinate, and delay their investment journey as long as they could, yet always paying their bills on time or even early!

When you receive your pay-check, you have a natural tendency to pay off your bills fast. Telco bills, utilities bills, rental, loan, insurance premiums, credit cards etc. Well, we should pay our bills and not let it roll over and become our debts, however do you need to pay it early? What’s the benefit of paying it early? It make you FEEL GOOD. That’s all. It has no other tangible benefits.

How about you aim to pay your bill on time instead, and allow your money sit on the bank slightly longer and earn the additional interest for you? Is there a significant difference in the amount that you are going to earn anyway? My honest answer is a NO. The difference is actually a slight dollars earned each month. Of course I can say that over the many years, these dollars saved can compound and perhaps help you retire 6 months earlier.

However, I feel that when you automate and pay your bill on time, instead of early, you get into the right habit of playing the money game. How you do anything is how you do everything, hence if you want to win in this money game, you gotta do the small thing right. It starts with understanding the fact that we should delay our bills as late as we can until the due date. If you have an option to pay your tax in yearly or monthly, and there’s no difference, I’ll pay monthly and let my excess money in the bank work a little harder for me. Unless you tell me that there’s a discount for paying yearly, I’ll do monthly.

Next, whatever bills, if possible, try to use credit card. Of course you make sure you pay your credit card bills on time. Why? Assuming your utilities bill is due for payment, usually they will give a grace period of around 15 days to pay. If you use credit card (auto-debit), the card will pay the bill for you, and you pay for the card bill 30-45 days later. Doing so delay your payment by a good 45 days and hence it allows your money sitting in the bank to earn that extra interest.

One practical way to automate is to collate all your existing payment due into a Google Reminder. What one can do is let’s say, the due date is 7th of the month, you can put a reminder to pay on the 6th. When you do so, you will not forget about paying your bill, and you also will not pay your bills early.

The conclusion for my post is simply; pay your bills as late as you can (please avoid overdue payment though), so that your money sitting in the bank can earn the extra interest for you.