Credit card question

[BassHead]

When i was younger and stupid i got my self into debt by thinking credit cards were free money and ruined my credit rating. Now that i am older and wiser i have taken care of my old debts and have now got a new credit card.

I have a decent amount of savings now and have no use for the credit card other than to build my credit. I plan to pay it off in full every month, my question is does it matter what time of the month i pay it off? for example i just spent £100 on it 10 mins ago, if i pay it off right now today will that make any difference to the way i build my credit rating or does it not make a difference providing i pay in full every month?

 

[radderfire]

It doesn't make a difference providing you pay it off every month, i.e. when your card company gets you to settle.

Also, as you have previous form, make sure you do pay it off every month, and don't get tempted to overspend!! Remember, save first, then spend it.

 

[Andre]

See if you can set up a direct debit to pay it off in full - that way, as long as you do not go over your ability to pay, the balance will be taken in good time by the credit card provider.

 

[dlockers]

No, but don't get muddled. Often the payment isn't applied instantly, and unless you are looking at nice round numbers, you could end up over paying your credit card which may be deemed a bad thing (and is against their ToS).

E.g.

Buy Pizza -> £17.99
Balance 17.99 | Pay £17.99
Buy Crap -> £2.99, £3.98, £2.73
Balance 27.69 | Pay ...... you need to do the maths and remember.

The reason balance shows as £27.69 is because the £17.99 payment can take a day or two to "hit".

 

[pepp77]

I do all transactions on my credit card and then have a DD setup to pay off the balance each month. I find it easier to monitor my spending this way than using my normal debit card. Also means I get extra bonus points on all the spending.

Also to add, when I was a lot younger I too got into problems using credit cards well beyond my means, I never defaulted on any payments or got bad credit, but I was always at my limits and it took me several years to get out of the cycle.

 

[Semple]

Your card provider will tell you when the balance is due with your statement. The balance can be paid off at any time upto that point.

 

[BowdonUK]

My card has a minimum payment it takes each month from my bank account if the credit card value isn't zero.

I think the best idea is to try and make payments around the same time each month.

 

[Gixer]

My card has a minimum payment it takes each month from my bank account if the credit card value isn't zero.

I think the best idea is to try and make payments around the same time each month.

This repayment setup isn't ideal, you'll pay masses of interest. It is however the default setup usually.

I do as another said. I've ticked the 'pay in full' box each month and that is taken via DD. In doing this I pay zero interest. I buy everything using credit card, I never use my own money when buying items unless I have to. Once set to pay in full and the DD is setup just use your credit card like you would a debit card. Its up to you to manage your spend.

 

[BowdonUK]

This repayment setup isn't ideal, you'll pay masses of interest. It is however the default setup usually.

I do as another said. I've ticked the 'pay in full' box each month and that is taken via DD. In doing this I pay zero interest. I buy everything using credit card, I never use my own money when buying items unless I have to. Once set to pay in full and the DD is setup just use your credit card like you would a debit card. Its up to you to manage your spend.

I'll look in to doing that. I hadn't thought of it in that way before.

 

[arknor]

shouldn't there be an option to auto pay the balance off in full via direct debit?

used to be an option when I last had a CC 2 decades ago

 

[Martynt74]

shouldn't there be an option to auto pay the balance off in full via direct debit?

used to be an option when I last had a CC 2 decades ago

Yeah there is.

I have mine set to pay the minimum by DD, but then make a manual payment for the full amount. Main reason being the payment date is around 3 weeks after i'm paid and so it's better to get it sorted straight away, i just have the DD there as a safety net incase i ever forget.

 

[Gixer]

Yeah there is.

I have mine set to pay the minimum by DD, but then make a manual payment for the full amount. Main reason being the payment date is around 3 weeks after i'm paid and so it's better to get it sorted straight away, i just have the DD there as a safety net incase i ever forget.

I face this scenario but it just comes down to budgeting. I get paid on the 16th but my DD for my CC is taken on the 11th or 12th of each month. As its basically money I'd usually spend on my debit card and I've budgeted the cash is always there to pay the bill. If I spend out on anything extra, a big spend for example, I'll ensure I've placed enough funds in my current account to cover that spend.

Having minimum only set I'll not do as I don't ever want to pay any interest! If you can budget its no problem, that and use your CC as you would a debit card and not as a bank loan.

 

[montymint]

Yeah there is.

I have mine set to pay the minimum by DD, but then make a manual payment for the full amount. Main reason being the payment date is around 3 weeks after i'm paid and so it's better to get it sorted straight away, i just have the DD there as a safety net incase i ever forget.

I do exactly this too.

 

[mikeggratton]

I do the same, DD for the minimum payment and then do a manual payment for the rest

 

[Jean-F]

I’m still trying to get my head around how the OP thought that CCs were free money, and I’d loved to have seen his face when the letter arrived which informed him that it didn’t work like that.

 

[touch]

I’m still trying to get my head around how the OP thought that CCs were free money, and I’d loved to have seen his face when the letter arrived which informed him that it didn’t work like that.

It's not really that difficult to understand, is it?
You can spend thousands on it and only have to pay back a few pounds each month. It's clear to see why some people see it as an easy way to access money.

 

[Hannibal Buress]

It doesn't make a difference providing you pay it off every month, i.e. when your card company gets you to settle.

Also, as you have previous form, make sure you do pay it off every month, and don't get tempted to overspend!! Remember, save first, then spend it.

THANK YOU!!! for the longest time I had the same question "does it make a difference when to pay it off when you are paying it off every month?"

Thanks, I'll sleep better tonight

 

[BUDFORCE]

I do the same, DD for the minimum payment and then do a manual payment for the rest

I do this as well.

I use an Amazon cc for the vouchers and added security. I always pay it in full every month.

 

[Steeps]

My statement is on the middle of each month, with the full amount taken out just over 3 weeks later. Makes it easier to keep an eye on the spending and it means any larger purchases I've not budgeted for can be bought in the later weeks and be paid for using the pay from the month after. I've never had to adjust a payment or pay it manually apart from one month where I was at risk of going over the credit limit.

Its also great for work expenses because they'll pay me at the end of the month before the credit card payment is due, or a whole month early if it's expenses from later in the month.

It should be simple enough to treat it as a "negative balance" if you use an app to manage it, then let it pay it off in full by direct debit when it wants it.

 

[Jean-F]

not all of us were dragged up in the days of rickets, farthings, london smog and horse rawn carroages. it was very easy to get dragged into debt a few years ago, credit was simple to get and encouraged and a lot of people were caught up in.

laugh all you like, i managed to get into a situation where i had a mortgage, loand and multiple credit cards, almost all topped up to the max and unable to pay off even all the minimum payment. i ended up using credit card cheques to put the minimum payment of one onto another which was terrible because the interest on those was the same as if id drean cash out of a machone on the card. with nobody to talk to, debt easily spirals out of control.

even in that situation, i was being offered more credit.

it took me over twenty years to clear it all off and almost all my disposable income every month went on my debts

just bvecause you are so bloody perfect, that is no reason to react like that.

I’m far from bloody perfect, but the OP read like he thought that he could use the card as a magic money machine instead of working for it or drawing it from the bank.
That’s what I meant when I said that I couldn’t understand his reasoning, it seemed like he thought that he could use the card but never pay for what he was buying, and I wouldn’t laugh at you or him for getting caught in a credit trap.
I too was bombarded with invitations to sign up for Access, Amex, Diners Club, Visa, and Master Card years ago, but being brought up when the Romans were still occupying Anglia, I had enough street smarts to say no thanks.