I went to visit a neighbor the other day and arrived as she was just beginning to pay her bills. It looked like quite a project, with all the papers spread and stacked on the kitchen table so I asked if I should come back later. She said no and invited me in to chat while she went through her bill paying routine. Now, I know that this neighbor has quite a bit of debt because she complains about it when we go for walks. But I never imagined how much it complicated her life until I witnessed this bill paying exercise.
While we talked she sorted everything into piles. She explained that one pile was the bills to pay now, one to pay later when more money came in, and one to completely ignore for now because she just doesn’t want to/can’t pay them right now. I didn’t say anything (although I really wanted to talk about the ones she was ignoring) because it’s not my business and just kept chatting about the weather and neighborhood events.
Once she got everything sorted (which took a good twenty minutes), she started paying. As I sat there she paid eighteen bills, mostly utilities, mortgages (first and second), car payments, and things like cable, phone, and Internet and a couple of credit cards. Some she paid online, but she wrote checks for more than half. By the time she had them written, stamped, addressed, paid, and recorded another forty-five minutes had passed. We were now over an hour into this exercise and she wasn’t done yet.
She picked up the pile of things to pay later and started prioritizing those. Most were credit cards, but some were insurance payments with later due dates. I counted nine more bills that she laid out on the table. She decided that she could really pay two more bills right now and wrote two more checks, stamped and addressed the envelopes, and recorded the payments. So we’re up to twenty-seven bills that she has to pay this month and, with this part of the process finished, up to about an hour and thirty minutes of time gone and all the bills still aren’t paid. She’ll repeat this process in a week with the remaining bills when more money comes in. I kept chatting, but inside I was thinking, “Holy cow, this is crazy.”
Then she looked at the pile of things to ignore. Thankfully there were only about six bills in this pile. It’s never good to ignore your bills, but at least it was only six. The way this process was going I was afraid it would be closer to fifteen. She looked at each one and sighed. Most were credit cards that I guess she was no longer using so she was willing to make them wait for money. She looked at me and said, “There’s just never enough, is there?” I murmured noncommittally and changed the subject. I didn’t want to say what I was really thinking which was, “Well, gee, if you’d reduce your debt and stop paying for crap you don’t need, there might be enough money to go around.” By the time she was finished and had everything put away, I’d been there for just over two hours. I figure she’s got at least another half hour or so to go next week with the remaining bills and then this process will repeat next month and the month after that. Her total number of bills for the month was thirty-three and that doesn’t count things that will come in at odd intervals like insurance, subscriptions, and trash collection (which around here comes quarterly or yearly, depending on how you pay).
This experience made me think about my own bill paying sessions. Because we’re debt free they are mercifully short. I counted: Every month I pay power, water, phone and Internet (counts as one bill because it’s bundled), one credit card (paid in full), and the security system. That’s five bills per month. It takes about fifteen minutes total because everything is paid online or automatically drafted. All I have to do is review the statements and make sure everything is correct. Twice a year I get my car insurance statement, but it’s automatically drafted. Once a year I get the home insurance and trash collection bills. These, too, are automatically drafted. Life insurance payments are drafted quarterly. Unless I take out a subscription to something or get billed for a medical procedure, I encounter no more bills. No car payments, no mortgage, no credit card bills, no bills for tons of services.
In a given year, I receive about seventy bills, counting all of my monthly obligations. My neighbor receives (at least) four hundred bills. I don’t even want to think about what she must pay in postage each year. I estimate that my total yearly time spent on bill paying is maybe four hours. My neighbor will spend almost that much each month. Being debt free and, not coincidentally, free from a lot of obligations and services means that very little of my valuable time is spent on this boring chore. It never stresses me out, as it does my neighbor. The money is there, the process is simple, and the bills are few. I’m free to spend my time doing something fun. My neighbor’s debt not only shackles her to her lenders, but it shackles her to that kitchen table for hours every month. It’s really a deal with the devil: You incur debt and buy a lot of “fun” stuff like expensive cars, toys, designer clothes, etc., and the payback isn’t always just the money you owe. It’s the time you have to spend paying the bills for all of your “fun.” Where’s the fun in that? It’s not a deal I’m willing to make.
When we think of the benefits of being debt free we tend to think of the joy of not owning anyone, the freedom we have to spend as we choose, the ability to build wealth and to provide for our futures. We don’t often think of being debt free as being a timesaver, but my neighbors’ bill paying ordeal showed me that the time saved by paying few bills is an unappreciated benefit of the debt free life. When people say they don’t have time to do the things they want to do, having a lot of bills might be one reason why. Which would you rather have: Three to four hours spent at a kitchen table every month paying bills or fifteen minutes spent paying bills and three hours spent doing something that’s fun and important to you?