Credit Card Basics – How To Pay A Credit Card Bill

If you use credit cards, you will get bills that you need to know how to pay.

Most people pay their credit card bills online, and many have them set up to pay automatically. But not everyone knows there are ways to pay off your balances faster, save money on interest, and raise your credit score.

Let’s talk about how to pay your credit card bill, when you should pay it, and how to choose the best way to pay your credit card bill for your long-term financial goals.

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When Should You Pay Your Credit Card Bill?

You can do either of the following: On time or early, it’s always best to pay on time.

Paying Your Credit Card Bill On Time Is Very Important

Your payment history on credit cards makes up 35% of your FICO credit score. This means that making payments on time and regularly is an important part of building good credit.

If you miss a payment or pay it late, it can hurt your credit score and cost you money.

If you don’t pay your credit card bill on time, the company that gave you the card might charge you a late payment fee or raise your interest rates to the penalty APR level.

On the other hand, if you pay off your credit card statement balance every month, you won’t have to pay any interest on your purchases. Most major credit cards give you 21 days to pay off your statement balance in full and on time before they start charging you interest on new purchases.

It’s A Good Idea To Pay Your Credit Card Bill Early

By lowering your balance, you can lower your credit utilization ratio, which is the second most important part of your credit score.

When you pay off your credit card (and you can pay more than once a month if you want), your credit utilization ratio will go down, which may help your credit score.

Ways To Pay Your Credit Card Bill

Setting up autopay online is the easiest way to pay your credit card bill (and make sure you never miss a payment). But there are also more manual ways to do things.

Online Payments

People often pay their credit cards online.

When they do this, money is moved from their bank account to their credit card account. If the company that gives you your credit card lets you do mobile banking, you can also pay bills with your credit card app.

By Phone

Call the number on the back of your credit card to make a credit card payment over the phone.

Make sure you know the bank account number of the checking or savings account from which you want the payment to be taken before you call. You can even send a paper check to the credit card company.

With Cash

Some credit card companies still accept cash payments made at a bank branch or an ATM, but other companies are starting to limit or get rid of cash payments.

Can You Use Another Credit Card To Pay Off One?

Technically, you can pay off one credit card with another by getting a cash advance on one card and using that money to pay off another card.

However, this is usually not a good idea.

Cash advances can be very expensive because they have high interest rates and cash advance fees. Also, if you use a credit card to get cash, you add to your debt.

Is Carrying A Balance On Your Credit Card Good Or Bad?

Try not to have a balance on your credit card as much as possible. Not only will you be charged interest on your balance, but that interest can also add up over time.

Also, if you have a balance on your credit card, you can’t use the grace period.

Most credit cards give you a grace period of 21 days where you don’t have to pay interest on purchases. However, this grace period only applies if you pay off your full statement balance each month.

If you can’t pay off the full balance on your statement, you’ll be charged interest not only on the amount you still owe, but also on any new purchases you make with the card.

If you can’t pay off your credit card statement balance in full, try to pay as much as you can. If you only pay the minimum on your credit card, it could take you a long time to get out of debt, especially if your interest rate is high.

When Will Your Credit Card Bill Arrive?

Most billing cycles last anywhere from 20 to 45 days.

Your credit card statement will be sent to you by mail or electronically at the end of your billing cycle, depending on how you want to get it.

The due date for your credit card bill should be the same every month, and you should get it on or around the same date every month.

Keep track of when your credit card statement should arrive in the mail or your email. So, you’ll have time to look over your statement, question any charges you don’t understand, and make your payment.

Advice On Paying Your Credit Card Bill

Here are some tips from experts that will help you pay your credit card bill even better:

• Change your due date. Many credit card companies make it easy to change the date when your bill is due. You can change your due date so it’s the same day as your paycheck, or you can spread out the dates of your credit card bills so you don’t have to pay them all on the same day.
• Set up automatic payments. Automatic payments are one of the best ways to make sure that you pay your credit card bill on time every month. When you set up autopay, your credit card payment is taken out of your bank account automatically.
• Plan ahead. Having a plan is the most important thing you can do to pay off your credit cards. How much will you pay each month toward your credit card bills? How often do you plan to pay off your credit card?
• Make multiple payments. If you’re trying to get rid of credit card debt, making extra payments can help you pay off your balances faster and reduce the amount of interest you have to pay each month.

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