No-Nos #26: Paying Your Credit Card (& other Bills) Late
Posted by Cap in Credit Related , Personal Finance |Sorry people. This is not 1992. There is absolutely no excuse to pay your credit card bill late these days — especially since you have about a gazillion different methods to pay.
If you have paid a credit card bill late before, you need to stop the BS right now and fix this extremely easy problem. Can’t afford to pay the entire bill? Fine. At least pay the minimum on time.
Besides the stupid late fees (that you might be able to get rid of), paying your bills late too many times will affect your credit history and score significantly. This may potentially cost you thousands of dollars later on in interest when it comes time to get an auto or mortgage loan.
Here’s information taken from a previous post on things you can do to avoid paying your credit card late:
Online Payment Saves The Day
Just about every major credit card issuer allows online payment. Your credit card doesn’t provide one and you tend to pay late? Ditch them. Seriously, get a new one. I’m not saying it’s a requirement, but if having a card with online payment can stop you from paying your bills late, then the money saved will be well worth it.
Many online payments also allows you to schedule your payment, automatically. That means you can set your bills to be paid on a certain day, via a certain amount. Best bet for late payers? Set it to the minimum amount due, on the day that you know you’ll have funds in your checking account. Or, set it to a fixed amount if you have a balance currently. Better yet, set it to pay-in-full monthly.
Too lazy to setup an online account for your credit card? It will only take you a couple minutes to setup. The time you spend on this now will save you plenty more time in the future. Even if you don’t pay your bills late, you should sign up for an online account. The conveniences and accessibility will amaze you. If you’re careful with your password, and be proactive about distinguishing fake emails, security for your online account should be the last of your worries. Trust me, the benefits outweigh the low risk.
Changing Due Date To Fit Your Busy Lifestyle
Don’t want to sign up for an online account? Want to do this the hard way? Fine. Did you know that most major credit card issuers will allow you to change your bill due date? This means, you don’t have to worry about writing out different checks to different card issuers on different days. Call up your credit card company and check if they’ll let you change your due date to a more flexible date.
Quite a few issuers also allows you to set your due date while you apply for your credit card, so keep that in mind the next time you open up another credit card account. Match the date along with your other bills, or set it after you receive your paycheck, plenty of options.
Pay By Phone To Save Your Butt
Today IS the last day and you totally forgot to pay your bill? Many card issuers also allows you to pay by phone, but make sure there aren’t fees associated with it before you use it. Pay by phone is indeed the last minute option. Last week, I totally forgot about a bill due for my Bank of America VISA. While I was busy hating myself (again), I realized I could pay by phone. Flip the card around, call the 1-800 number on the back, punch in my checking account information, specify the amount, and I’m done. Once again, modern day convenience beats out modern day laziness.
Try Changing Your Attitude A Bit
As mentioned, there are many reasons why a person pay their bill late. I don’t want to get on a hypocrite lecturing rampage, but it’s in my opinion that if you adjust your mental outlook a bit, things will be a lot easier. You shouldn’t require a $117 late fee to make you think twice about paying late, just like how people shouldn’t buckle up just because of some lame threat (click it or ticket)—you should do it because it’s the right thing to do. If you’re starting to pay late frequently, ask yourself why. It’s worth it.
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10 Comments to “No-Nos #26: Paying Your Credit Card (& other Bills) Late”
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November 7th, 2006 at 1:14 pm
Another big no no is paying your auto insurance past the due date. In a lot of states, especially when your policy is renewing, a payment even one day late will result in a lapse in coverage. If you happen to have an accident that day it could really end up costing you.
November 7th, 2006 at 1:50 pm
I love your blog dude — probably the most brilliant name of a pfblog of all time.
I think the mantra of “STOP BUYING CRAP” could solve about 90% of the financial problems people seem to get themselves into in this country. If you don’t have it, don’t spend it.
As for paying bills late, I can’t say I have much experience. I’ve had my VISA card for nearly 10 years, and during that time, VISA has gotten a grand total of $24.50 from me in interest payments, once.
I never let myself hear the end of that, so I don’t plan on doing it ever again. $24.50 isn’t bad to pay for the ease of having a credit card for a decade. But $0 would be better.
November 8th, 2006 at 8:58 am
My husband doesn’t want us to sign up for automatic bill pay… he prefers to have “control.” I guess he doesn’t totally trust those services yet.
We pay the bill online, but we get a paper statement. And even though it’s the old-fashioned way, I don’t know if we’ve ever paid a late fee.
Our routine:
- Get bill in mail
- Write due date and amount due on big desk calendar
- Every payday, pay upcoming bills
End of routine. Simple. Uncomplicated. Easy.
It’s so easy, that I’m guessing a lot of people pay late fees because they don’t actually have the money to pay their bill.
November 8th, 2006 at 1:08 pm
all of my banking, bill paying, etc. is FREE and online.
i’m not sure i know how to lick an envelope or stamp anymore! i love it.
November 8th, 2006 at 1:55 pm
I’m not so trusting about the automatic withdrawals myself, PiggyBank Raid.
My personal solution to the late fee problem is that I pay the minimum payment the day I get the bill via online bill pay. Then I schedule the larger payment to be made a day or two before the end of the billing period. That way, even if something happens and I miss paying the full new balance by the due date, I know at least the minimum has been covered for that month.
November 10th, 2006 at 3:46 pm
Growth in Value: thanks for the compliment
oh for those that are worry about automatic payments.. many online bill pay service offered by either your checking or credit card account have certain guarantees when bill payments are made late or in error.
they usually reverse or pay for any late fee that are incurred due to their fault.
never hurts to be safe though.
November 12th, 2006 at 10:41 am
Paying the credit cards online isn’t a free one with some that I have, they charge 5.95 per transaction.
November 12th, 2006 at 10:45 pm
Was paying your bills late “totally awesome” in 1992? I was 6 back then, so I wouldn’t know.
November 20th, 2006 at 4:53 pm
Be careful of paying your bill by phone, as you may be stuck with additional $5-15 fee. That’s just another of the credit card traps that can trip up consumers and lead to spiraling debt. Consumers Union, the nonprofit publisher of Consumer Reports, has put together a lighthearted animated holiday-themed satire about abusive credit card fees and practices. Check out “It’s Always Christmas Time (for VISA)” at http://www.creditcardreform.org. Be sure to take action after viewing the animation!