Have you ever needed to set money aside for a future payment but the only way you could think to do it was to physically take cash out of your account and stash it in a safe place until you needed it? You don’t have to do it that way. Here’s an easy way to set money aside right in your checking account. But you do have to have a check register of some kind or it won’t work.
Here’s how you do it:
1. In your check register, record the item as if you were paying it today. Put the date, who it’s payable to and the amount. In the column where you would normally write the check number, put PAY. Anytime you see PAY in the check register, you know it’s an item you’ve subtracted but haven’t paid yet. Then mark the item as cleared.
2. On a separate piece of paper you keep with your check register (my register is in my planner and I have a page for Payables but you could use something as simple as a post-it note), record the date, who it’s payable to and the amount. You don’t need as much detail here.
3. When you balance your checkbook, you’ll add the check register balance and the payables sheet balance to get your total account balance.
4. When you pay the item, you’ll make an entry in your check register like this:
dep 9/13/12 Remit Capital One Payable $50.00
You’ll mark that entry as cleared.
5. Then go to your payables page and record the date and subtract the amount you put back on your checkbook register.
That’s it. And as long as you use your checkbook register for your balance (as opposed to looking on-line and seeing how much is there), you’ll have that money set aside and ready when you need it.
How or where do you set aside money for future payments?