For many people, Credit Cards are an essential commodity. Whether shopping online or in stores, the card helps you pay monthly utility bills and fuel, access exclusive deals while ordering food, and more. Credit Cards make buying things easy and rewarding. They also allow users to avail of cashback, discounts, and other special offers. Using it smartly and responsibly can help you earn back some of your money.
This financial tool may become a burden if used carelessly. While you apply for Credit Card online, be mindful of the finances, understand how it works, and know when to pay your dues. Missing payments lead to penalties, such as late fees, high-interest charges, and a drop in your credit score. To avoid this, you should pay your bills on time.
Tips to avoid late payment penalties on your Credit Card
If you wish to avoid late payment penalties on your Credit Card, you can make use of the following tips:
- Set up automatic payments
Setting up automatic bill payments on your Credit Card is recommended to avoid paying penalties. Most banks let you set up a recurring payment from your linked account to pay your bills every month on a certain date. You need not worry about missing the payment date or incurring penalties.
Through these automatic payments, you can opt to pay either the minimum amount due or the entire outstanding balance. You must maintain a sufficient balance to complete the payment and ensure your Credit Card payment due date is never missed.
2. Use Online Banking
Online Banking platforms have made banking accessible to customers on the go. You can use them to check your Credit Card statement, pay the bills, and set up reminders for the due date. The platform will send reminders and notifications before the due date so you can pay your Credit Card bill on time. You can also use them to apply for a Credit Card online.
3. Pay more than the minimum amount due
Paying only the minimum amount due is a convenient option. However, it can result in high-interest charges and debt accumulation. One way to avoid this is to try to pay more than the minimum amount due. It reduces your outstanding balance and saves you from interest charges.
4. Use it where necessary
Try using your Credit Card for necessary purchases and cash or Debit Cards for other expenses. Doing this keeps your outstanding balance low and helps you repay your Credit Card bill on time. For example, while waiting for your flight at the airport, you can use the Airport Lounge Access Credit Card to enjoy meals, take breaks, and sit in the lounge till your departure time.
Conclusion
To manage your Credit Card responsibly, creating a budget and tracking your monthly expenses is advisable. Stick to it and avoid using your card for purchases exceeding your repayment capacity.
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