Tuesday, September 3, 2013

Tip of the Day

Create your own escrow account for bills that aren't due monthly.

I have different bills that come due through out the year that aren't monthly.

Water bill - every 3 months
Car insurance - every 6 months (for 3 cars, at different times during the year)
Tutor fees for the high school home-schooled kids - twice a year in August and January
Home owners insurance - once a year
Property tax bill - once a year

Instead of having these bills show up in the mail, and me not prepared to pay them, I opened another online savings account (at Capital One 360) and nicknamed it escrow (I also have a rainy day account and an emergency account with them). I took all the bills above and figured out the monthly damage from them. Each month I automatically have that amount transferred from my checking account (on the day my paycheck is direct deposited) to my "escrow" account.

Basically what a mortgage company would do if we had a mortgage.

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