How to Pay a Credit Card Bill

Posted by Frank Gogol

Paying credit card bills is something you’ll have to deal with if you own a credit card and use it. For many people who just got their card, though, it may be very difficult to do so. How to pay a credit card bill? If you’re asking this question, then you can rest assured that you’ll find the answer in this article.

When You Should Pay Your Credit Card

It’s important to pay your credit card bill regularly. You can’t just avoid making payments, because it will end up in a financial disaster for you. When it comes to making credit card bill payments, you can pay on time or early.

Why You Should Pay Your Credit Card on Time

Paying your credit card on time is important because it helps maintain your credit score and even build it. On-time payments are some of the things that contribute to your credit score, which is why everyone focuses on them. Therefore, making late payments could really harm your score, and you don’t want that to happen if you wish to take some sort of loan in the future.

On top of that, late payments will also cost you more. Some card issuers increase the interest rates or charge late payment fees. In the end, even if you don’t pay that amount on time, you still have to pay it together with the extra fees for being late.

Also, if you can successfully pay off your credit card balance every single month, you won’t have to deal with any interest. There are many credit cards coming with a 21-day grace period before they apply any interest on a new purchase. Of course, this happens as long as you always pay the amount on time and fully.

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Why You Should Pay Your Credit Card Early

If you have the money, you can pay the credit card bill early. It is especially beneficial if you’re looking to grow your credit score. When making early payments on your credit card bill, any interest charge you deal with monthly will be reduced. As such, you will not only get rid of one of your bills earlier, but you’ll also manage to pay less interest over time and perhaps even save some money.

Furthermore, your credit utilization ratio will decrease if you manage to lower your balance. 30% of your FICO credit score is made from credit utilization, so your credit score will be increased whenever you pay against your credit card.

How Can You Pay Your Credit Card?

Paying your credit card bills is not difficult. Nowadays, you don’t necessarily have to go to your credit card issuer to make the payment. It’s possible to do it from the comfort of your own home if you have Internet access. So, people make online credit card payments, allowing the money to be sent from your bank account to the credit card account. This is even easier if there is a mobile banking app offered by your card issuer, as it will let you make payments from your phone.

Another possible method is, of course, paying in cash. However, you have to keep in mind that not all credit card issuers will be willing to accept cash payments. Some issuers started slowly eliminating this method. Before using this method, you should check the guidelines of the card issuer.

Making a credit card payment over the phone is possible as well. To do this, you should call the number on the back of your card. Before making the call, ensure you have the number of your bank account ready because your money will be deducted from your savings or checking account. Another way to do it is by mailing a paper check to your credit card issuer.

If you have another credit card, you may also be wondering whether it’s possible to pay for one’s bills using the other. Well, it is an option, but not a good one. When you take a cash advance, it could be very pricey. They have high interest and they may even have cash advance fees. On top of that, do you really want to end up creating some new debt? It will only send you deeper down the financial hole. Considering debt management options is a better idea than borrowing from another card if that is your only current alternative.

Should You Keep a Balance on Your Credit Card?

When possible, you should not carry a balance on your credit card because it is pricey. First of all, you will be charged interest on your balance, which will add more to your debt and it will become harder to manage. Secondly, you will lose access to the grace period of your credit card.

Keep in mind that this grace period is only available if you pay the statement balance fully every month. So, if you don’t pay, you will end up being charged interest on the balance and your new purchases.

If you cannot pay the full statement balance for any reason, you should still consider making a minimum payment. Pay off as much of the balance as you can. It’s better than not paying at all.

When Should You Expect Your Credit Card Bill

The billing cycle of every card issuer is typically between 20 and 45 days, so at the end of your billing cycle, you should receive the credit card statement. You can even get it electronically or by mail.

Credit card issuers have to offer their consumers at least 21 days between the date of the statement mailing/delivery and the due date of the payment, as they are required by the Credit CARD Act of 2009 to do so. Bear in mind that your credit card bill will have the same due date every month.

Tips for Paying Your Credit Card

Here are some tips to help you manage your credit card bills better:

Make a Plan

Establish a plan and stick with it. This should include how much you are willing to spend on credit card bills every month, and how often you make payments. Planning early will help you get organized and handle the matter more easily. 

Consider Automatic Payments

If you tend to forget the due dates, you should set up automatic payments. They will automatically withdraw the amount from your bank account and pay the bill.

Change the Due Date

If you have issues with the due date, you can change it. Pick a day when you know for sure you are getting paid, for instance. It’s important to choose something that works in your favor.

Make Several Payments

You can make an extra card payment if you want, which will help decrease interest and your balances. Making an additional payment now can save you more money later on.

The Bottom Line

Credit card bills may be a nuisance, but you have to pay them no matter what. Use these tips to handle the debt much easier. Also, don’t forget to always pay attention to due dates and the rules of the card issuer, and make sure to avoid credit card mistakes.

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