Are You Paying Your Bills Too Soon?
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Are You Paying Your Bills Too Soon?


The top priority for most small business owners is to have enough cash to run their business and ultimately give them the life they always dreamed of. But, sadly, that’s one of the biggest challenges. From not having enough sales to slow (or no) paying customers, the list of items that impact your cash flow can be a long one.

And you may be one of the biggest problems.

Monitoring cash flow isn’t sexy or fun like marketing. Many of the small business owners I know consider it to be drudge work. But your business can’t survive without it.

There’s really only two ways you can control the cash flow in your business – increase what’s coming in or decrease what’s going out. Way too many small business owners don’t pay close enough attention to what’s going out of their business and when that happens which is a critical key to success. A bill comes in and then it gets paid with no consideration for how that payment may impact the overall financial health of your business. You may actually be negatively impacting your bottom line by paying your bills too soon. Taking a step back and using a strategic approach to paying bills can help your cash flow.

Now I’m not advocating that you pay your bills late. You expect to get paid on time for the products or services you sell and should model that behavior when paying bills for your business.

But rather than just getting a bill and paying it, it’s a better idea to look at the big picture.

Here are four things you need to consider:

  1. Is your business checking account interest bearing? If you make interest on your checking account, it’s a good idea not to pay your bills with next month’s due date until after the first of the month. That way you’ll get the benefit of the interest and still pay your bill on time.
  2. Will it save you money to pay the bill before the due date? If the vendor provides credits for paying early, take advantage of that. Often vendors will offer a 10% discount for paying a certain number of days prior to the actual due date. If you can get a discount on the amount you owe each month, that will end up as a nice chunk of change over time.
  3. Can you get more bang for your buck by paying with a credit card? If you have a business credit card that offers points for purchase, paying your bills with that card can reap you some extra “cash” for other purchases via your points balance. It also, in essence, extends the payment time frame to give you a bit of breathing room. Use caution here though. If you pay your bills with a credit card, make sure you have enough cash to pay that bill off in full every single month. You don’t want to create a new recurring debt in the process.
  4. Is there an online autopay option you can use? Most utility and subscription services will allow you to set up automatic payments that don’t activate until the actual due date, then it takes an extra day or two before that payment is deducted from your checking account. This actually extends your “cash in hand” which may be just enough for your business to benefit.

It’s best to know what your situation is with your cash before you’re knee deep in the middle of a problem. Planning out your bill payments has a lot of benefits and won’t take a ton of your time. Here’s what you need to do.

  • Review all of your bills for the past twelve months.
  • Sort the bills into stacks. You’ll want to make a stack of monthly, quarterly, and annual bills.
  • Map out each of the bills in a spreadsheet by due date. Make a note of any special payment agreements like early payment discounts or payment time extensions.
  • Prepare a plan for paying your bills. Monitor your plan once a week to keep it on track.


About the Author: 

Small Business Expert Denise O’Berry is the author of “Small Business Cash Flow: Strategies for Making Your Business a Financial Success” a book about how to get, manage and keep your cash flow on an even keel and where it belongs — in your business. A small business owner since 1996, Denise has worked with hundreds of small business owners over the years and is inspired by their enthusiasm and ability to overcome huge obstacles. She provides small business tools, tips and advice to small business owners around the world on her blog at

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