computing credit card bills

How to pay your credit card bills on time each month

Information verified correct on December 9th, 2016

If you’re struggling to pay your credit card bill by the statement due date, these simple tips can help you get back on track.

Making credit card repayments on time keeps your account in good standing and leads to a healthy credit file. The due date for a payment on your card is generally a couple of weeks after the statement is issued, and credit card companies specify that you must pay at least the minimum by this time. If you don’t, you could end up being charged a late payment fee and find a black mark on your credit history. This guide looks at simple and effective tips you can use to avoid these pitfalls and make sure your credit card bill is paid by the statement due date every month.

How much do I have to pay every month?

You can choose to pay the following amounts:

  • Your full closing balance
  • The minimum payment due each month, either a percentage of the closing balance or a set amount.
  • A percentage of the closing balance, usually around 2-3%.
  • A set amount of your closing balance e.g. $25-50.

How to pay your credit card bill on time

These tips are key to maintaining a good history of credit card repayments.

  • Work with a budget

Budgeting is a key first step to paying down your credit cards. A budget allows you to factor your credit card payment into your regular expenses so that you have enough money set aside to make a payment by the due date. You should always aim to pay more than the minimum required each month to avoid excessive interest charges.

If you’re struggling to meet the minimum monthly repayment, you can also use a budget to see where your money is already going. You can then make adjustments to your spending habits in order to meet your credit card repayments. For example, if you regularly spend $100 a month on entertainment, halving that will give you $50 you can put towards your credit card debt. If your debt’s really serious, you may want to temporarily cut out some of your non-essential expenses until you’ve got your balance to a more manageable level.

  • Change your payment due date

If it’s a matter of streamlining your finances, you may want to request a change to your statement due date. Contact your credit card company and bring your statement date forward, or backwards, so the repayment due date falls around when you get paid.

  • Use autopayments

Most credit card companies provide you with a direct debit or “autopayment” option. You can set this up to pay the minimum, full or a partial amount of your credit card balance each statement period. With this service, your transaction account is automatically debited to pay your credit card on the same day every month. This ensures you always make a payment by the statement due date.

  • Modify your payment frequency

If you get paid weekly or fortnightly, you may want to make a payment on your credit card as soon as that money lands in your bank account. This strategy could help you stick to your budget for credit card repayments by taking away the temptation to spend that money on other things before your credit card payment is due. As credit card interest is charged daily (but calculated monthly), it could also help reduce the total that you pay on your balance for that statement period.

  • Set calendar reminders and use online banking services

Take the time to set up calendar notifications and download banking applications so you’re informed about your finances. Many Internet and mobile banking services offer reminders about your account – including payment due dates – so check to see what options your credit card company provides and opt-in to them if you often forget to make a payment on time.

What are the benefits of paying your credit card bill on time?

  • No late payment fee. Make your credit card repayment by the statement due date and you’ll avoid the late payment fee.
  • Save on interest. Pay your credit card balance in full by the due date and you can make interest-free purchases between statement periods. Cash advances are ineligible for interest-free days.
  • Avoid debt. You can be charged interest on interest if you carry a credit card debt from month to month.
  • Improve your credit score. Maintain a good repayment history (paying at least the minimum) to keep your credit file healthy. Your credit file shows whether you’ve missed any credit card repayments in the past.

How to make credit card repayments

Credit card companies make it easy to pay your credit card using online banking, but also include a range of other options. These payment details are listed on your statement, and could include:

  • Internet banking. Link your credit card, transaction account or savings account using Internet banking. You can make credit card repayments with a couple of clicks.
  • Autopay. Download and complete an autopayments form to debit funds from a nominated transaction account.
  • BPAY. You can pay a credit card using BPAY. After logging into your Internet banking account, look for the “Make BPAY payment” section. Enter your credit card number, the BPAY biller code and how much you want to pay.
  • At a branch. Make a cash or cheque payment in person at a branch.
  • By post. You can send a cheque in the mail to the address listed on your credit card statement. This is a lengthy process and there’s a chance you’ll incur late payment fees if your cheque doesn’t clear in time.

Whatever payment method you choose, make sure you allow enough time for it to be processed by the due date on your statement. For example, let’s say you want to make a BPAY payment, which can take up to two business days to process. If your due date is 25 October, you should aim to make the payment on or before 23 October to ensure that it is received by your credit card issuer on time.

There are many reasons why you may not be able to pay your credit card bills on time each month. But whether it’s debt troubles, forgetfulness or an unexpected event, putting these tips into practice can help you get on top of your repayments every month.

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