Money Sense Tips

If you have a credit card, you may have noticed that from time to time you receive a tiny booklet delineating either rising interest rates or changes to the terms of payment.  It’s important to read this information as you may find that if you do not pay off your bills on time you may incur more than a late fee.

For example, here is a typical credit card policy: “The APR is 8.99%.  Your APR may be higher.  We will set your initial APR between 8.99% and 24.99% based on creditworthiness.  We reserve the right to change your APR, fees, or other credit terms at our discretion.  Additionally, if you fail to pay any minimum amount payment by its payment due date, we may increase your APR up to a default APR of 27.99%.”

This particular creditor is not unlike others you may have applied for.  It is important when applying for a credit card to ascertain the APR rate, monthly fees, and default percentage that may be incurred if you do make late payments or skip a payment.

Not paying off your bills on time can make an already complicated situation worse, especially if you are living from paycheck to paycheck.  Moreover, not only will you incur the highest APR percentage on that card, but it will also be reflected on your credit report, thus lowering your FICO score.

The key to successfully paying bills when they are due is to establish and stick to a budget.  In this way, you can list all household expenses and debts and pay them accordingly every month.  Most of the time, credit card payments are due between the 15th and the end of the month.  If you are paid on a bi-monthly basis, setting aside money for each bill may be easily achieved.

There is also another alternative that can assist you in paying bills on time.  You can sign up with credit card companies to pay via the internet.  This does not replace receiving the bills through the mail; however, you can access your statement at any time and by receiving emails letting you know payment is due, you are more likely to pay them on the date the email is received.

Moreover, the company provides the due date so that you can decide to either pay it on the day you receive the email, or you can click on the calendar provided and make the payment as close to your payday as possible.

It is a perfectly safe method of paying bills on time.  All you need to do is to provide your checking account information and once payment has been made, it is posted to your account on the same or next day.  In fact, you will receive an email stating the payment has been posted.

Paying off bills on time affects your FICO score in a positive manner and decreases the possibility that additional late fees and increased APR rates will be incurred.  In addition, by using the internet to pay bills it affords you the opportunity to never miss a payment again.

If you are interested to learn more how you can pay off your bills on time, you may be interested to check out this book – the Ulitmate Debt Guide by Scott Stephen.