While the need to always get your business bills paid on time seems like a no-brainer, it can be more difficult than you think unless you’ve got a system in place. The key to never missing a payment all comes down to organization.
Dedicate a service to handle accounts payable
Dedicating a service to handlling the paying of your business accounts can mean several things. If you have a large company, you should hire someone and perhaps even have an entire department dedicated to paying your bills on time. But what if you have a small business, just you and a few others?
If you have a small business of just one to 10 people, then having an entire division or even one person on the payroll to handle accounts payable may be too expensive. There are, however, automated systems that will make sure you don’t forget to pay your bills on time.
You can set up a calendar, oftentimes right there inside your email program. The calendar not only reminds you when a bill is due; if you use an email client-based calendar, it will even send you an email reminding you.
You can also set up an auto-pay system. This will electronically pay bills from your business checking account. This can be set up on a reoccurring basis so you are sure never to be late. Making late payments can harm your company’s credit rating, even make it more expensive to borrow money.
If you don’t want to use auto-pay, then simply have your reoccurring bills debited directly from your checking account.
Prepay or pay your bills immediately
An even simpler way of making sure all your bills are paid on time is to pay them in advance. Prepaying a bill makes sure that even if you forget, you’re still not late. Prepayment sometimes also makes it possible for you to get a discount.
If you pay the electric company $1,000 in advance, for example, then the money for each month’s bill is simply deducted from your account, making sure you are never late. Most power companies, phone companies, and other utility services are obligated to pay you interest for holding your money, as well.
Another way to make sure you get your bills paid on time is to pay them the day they come in the mail. Anyone can push a bill aside and forget about it later. If you’re busy, then pay that bill the moment you open it, and you’ll never be late.
Have a backup plan
All this advice so far sounds wonderful—if you never have cash flow problems. But oftentimes, paying a bill on time has nothing to do with forgetting, but instead can be because you just don’t have the cash reserves.
In such cases, it’s a good idea to have a fallback position. This means leaning on an organization like Billfloat. Billfloat is a service for those rainy days when you might be short of cash, but the bills keep coming. Billfloat is a fee-based service with incredibly affordable rates. After all, it’s better to pay a little extra now than to get behind on your bills and pay a lot later.
What do you do to ensure that your business bills are paid on time?
Published: June 27, 2013