For most of us, paying the credit card bill is top priority, and it should be. But unless you pay the minimum monthly payment–which is strongly discouraged, it can also be a big bill to pay each month. There are a lot of reasons why we cannot make on time credit card payments.
We may not pay it on time because, first, we don’t always have the money. Second, we may forget to pay it. Third, we may be unemployed. Fourth, we may have family emergencies.
If you don’t pay it on time, you may get a late fee depending on your credit cards. And you may pay more in interest. Those interest will be added to the principal.
That’s why it is always a good idea to have your credit card lenders to debit your checking account on the day the monthly credit card payment is due.
Just about every major credit card companies have that option to set up automatic payments, where you sign up online and agree to allow the credit card payment to debit your payment from your bank account on a specific date each month.
But remember to have enough money in your bank account to cover the amount to be withdrawn. A few days before the payment is due, you will get a notification from your credit card company that your automatic payment is coming up.
And on the due date, they will withdraw the funds from your bank account, even if you make other payments. But they will not make any withdrawal if you have a $0 balance on your credit card when the automatic payment begins processing, which is usually a day or two before the due date.
So automatic payment is important, because you will make sure your credit card payment is always in time. It is important because you won’t get hit if a late fee; you will maintain a great billing record, and the credit card company will likely raise your credit limit without asking for one.
It is also important because it is smart money management for you.