Late credit card payments are something that you want to keep from happening because it can seriously affect your financial standing. Some people think that the late payment penalty on your credit card debt, being only $35 or so is not too great. It may seem like a small amount but to someone who is trying to make ends meet, every dollar is important.
Of course, the effects of your late payment is not only on the balance but the interest amount that will be added on top of your growing balance. You have to consider that before you become too lax in your payment schedule.
Tips to never forget your credit card due dates
Fortunately for you, there are many techniques and tools that will help you monitor all your bill payments. You can download online checklists like the one from About.com called the Monthly Bill Payment Checklist. There are also mobile applications that you can use to help manage and monitor all your debts. You can go to the iTunes store to download their bill manager and reminder tool.
Here are more tips to help keep you from being late on your credit card payments.
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Change your due date. If you have multiple debts, that can really be hard to track. You can call your creditors and ask them to change it into a date that you can easily remember. It can be a few days after your paycheck comes in so you still have enough funds in your account to finance it.
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Combine your debts. Another option is to use debt consolidation to help combine all your debts together. This will simplify your payment plan and thus keep you from forgetting to pay it – since one payment is not too difficult to remember.
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Make a calendar for your due dates. This is simply putting everything that you need to pay for in a calendar. You can write it on an actual calendar that is very visible for you to see. Or you can use the calendar on your mobile phone and have it on alarm. Since you always have your mobile with you, these reminders will always reach you.
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Apply for email notifications. Most credit card companies have email notification programs that you can apply to. You can utilize this tool in order to set up a reminder for your debt payments.
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Set up automatic payments. You can also link your credit account payment to your bank so your monthly dues can be automatically deducted.
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Pay online. Paying online will enable you to send you monthly contributions anytime and anywhere. You don’t have to go to the payment centers to settle your dues.
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Don’t wait until the last moment to pay your dues. Your billing usually comes 2 to 3 weeks before the due date. Try to remove the habit of waiting until your due date is tomorrow. Pay the bill as soon as you get it.
As you implement one or two of these, you also have to remember to double check everything that is placed on your statement. Do not just pay what you see. Check if the details are valid and if the payment you made the previous month is already credited.
Benefits of paying your credit dues on time
By never being late on your monthly credit card payments, you are actually setting up a domino effect of benefits for your financial standing. It is always a good idea to follow the rules and this includes your payment due dates. To help motivate you, here are some of the advantages that you will get if you make timely payments on your credit card account.
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Keeps collection calls from happening. Collection agencies can harass you to pay your dues and you want to avoid this as much as you can. When you have taken a long time to pay your debt, the creditor will turn to collections to make more aggressive efforts in forcing you to pay.
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Protects your credit score from harm. Your payment history affects 35% of your credit score and your late payment will harm this as long as you keep on doing it. A good payment behavior is very important to keep your credit report from being tarnished.
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Increases the chance of a low interest rate. Your good behavior when it comes to payments will not go unnoticed by the creditors. You can actually use it to negotiate for a lower interest on your current account. And when you apply for a new one, you have every right to ask for a low interest rate because you can prove that you know how to pay your debts in time.
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Saves money on late fees. As mentioned earlier, late payments are penalized and this will amount to around $30-$35. This will be added to your previous balance and the sum will be the basis for computing the interest amount that will be included in your minimum payment.
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Lowers your monthly payments. Since there is no unnecessary penalties being imposed on your debts, you can make better progress in paying them.
Here is a video that discusses how late payments can affect your financial situation and your credit score. The video also discusses the possible scenarios that will help you keep the late payment damage from being too severe.
