Avoid Late Fees - Keep Those Extra Dollars in Your Pocket

When money is already tight and spare change is hard to come by, late fees only make things worse by adding charges you wouldn't otherwise have to pay. With some responsible personal accounting and more disciplined spending habits, you can eliminate some unnecessary expenses. By spending wisely and paying all your bills on time, you establish a good credit report and keep yourself from falling through the financial cracks.

Depending on the creditor and company policies, there's often more than one way to pay a bill. Traditional bill pay via personal check is by far the most common and popular method, but in this day and age, consumers may sometimes pay according to their preference. Cell phone companies generally allow payment by phone through an automated service that can store your credit card number for future payments. Some merchants - especially those with Web site shopping options - offer online bill pay, either at the time of purchase if shopping on the Internet, or as a convenience for those who had made their purchases in the stores.

Some creditors charge late fees up to $25 or more without any sort of warning, while at other times a creditor may impose a finance charge of 50 cents or another small amount as a prompt pushing consumers to pay future bills on time. Whatever the case, the following tips aim to help shoppers and spenders reduce incidences of late fees.

Tips on avoiding late fees:

Don't spend money you don't have, or cash you don't expect to make before the bills come due.

Pay your bills in full, if at all possible.

If you must carry a balance, pay at least the minimum amount due every month.

Try to reduce the number of charge cards you own. Do you really need a GAP card, a Wal*Mart card, a Macy's card...?

Consider setting up an automatic bill-pay for your account, as long as you know for a fact that you will have enough money in your bank account each month. By doing this, you won't even have to think about paying your bills - they'll practically pay themselves!

To help yourself keep track of when each bill is due, keep bills in the envelopes in which they arrived. Check each bill for its respective due date and write the date on the outside of the original envelope.

Put bills in the mail at least five days to a week in advance. Also realize that creditors may potentially access the funds paid to them immediately upon receipt.

If you think you might be away from home when the bills are about to come due, you can either send them early or pre-address them, fill out and sign your check and make sure everything is in order. Then merely ask a family member or friend to be sure to drop your bills in the mail for you.

Spending money on only the things you most need allows you to save some funds for that boat you've been wanting, a down payment on your new car or a vacation you've been dreaming about forever. By paying bills on time and either in full or at least in the minimum payment amount, you keep your credit score in good shape while forming responsible spending habits that should stick with you throughout your life.

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By reducing the number of credit cards you carry in your wallet, you also reduce the amount of work you have to do as each bill comes due. Fewer stamps are necessary, less time will be spent writing out and sending bills and fewer worries will nag your tired mind about whether your bill will make it to the creditor on time. The chances of receiving a late fee when you have seven or eight bills due at a time are much greater than when you have only two or three bills due. More bills means more chances to forget to pay one, resulting in a late charge.

If you are lucky, you may also reduce the amount of money you spend on a monthly basis by eliminating a few of your less-used credit cards. The urge to shop just may decline a bit as you thin the plastic from your purse.