I usually do this, I pay full balance immediately, would it be better to pay monthly?
2007-10-17 01:29:27 · 13 answers · asked by Anonymous in Business & Finance ➔ Credit
The best thing is to pay the amount due, not the full balance. Do this each month just in time to avoid any late fees. If you pay electronically, you can pay right on the due date. You pay on time to avoid any late fees, service fees, interest charges. You pay only the amount currently due (not the full balance) and pay it as late as possible so that you have your money in your bank earning interest for you. If you pay early or pay more than you need to, then the money is sitting in their bank earning interest for them.
2007-10-17 01:41:25 · answer #1 · answered by kill_yr_television 7 · 0⤊ 8⤋
If you want to make the credit card company VERY happy don't pay the balance off every month. They'll charge you 20% or more in interest. Thats how they make most of their money. That and they charge stores fees so they can take their cards.
Your much better to use the card as a 30 day loan & pay if off every month. Also if your card company charges you an annual fee find one that doesn't. Sound like you have a good credit rationg so finding a good free card should not be a problem.
2007-10-17 01:40:15 · answer #2 · answered by scotchdrnkr 3 · 1⤊ 0⤋
Better for who?
It's better for YOU to pay the full balance if your credit card has an interest rate because that way you don't have to pay any interest.
However, if you have an "interest free" card you may want to consider keeping a balance on it in lieu of using other sources of money that could used to pay down other debts or invested at a higher interest rate. BIG CAVEAT - This is something to manage very closely. Unless you're willing to invest the time and feel comfortable with "investing" and "budgeting" I'd just stick to paying off the balance every month.
It's better for THE CREDIT CARD COMPANY if you DON'T pay the balance because they get to charge interest on your balance.
2007-10-17 01:41:37 · answer #3 · answered by puppfanatic 1 · 1⤊ 0⤋
Let summarize all answers. If all responders, except one, say it is better to pay in full to avoid the financial charges, then it is true. But in one occasion you can skip full payment: when you have 0% interest for certain period of time. It does make sense to keep money on the interest earning account until the 0% expire. Make sure that you have enough to pay off your debt with one payment when time comes. In regards to how your payment affect your credit score, amount of payment does not matter as far as minimum has met.
On other side, if you are looking for new extended credit while you have 0% interest and balance on your credit card exceeds 40% of credit limit, that will drive your score down. So, evaluate your credit needs, money management skills and act accordingly.
2007-10-17 03:25:56 · answer #4 · answered by roginad 3 · 2⤊ 0⤋
No it isn't.
What is bad is keeping a balance on your card and having to pay interest. The interest rates on credit cards tends to be extremely high so you do not want to be paying interest on a credit card if you can avoid it (which you seem to be doing).
Some idiots think that carrying a balance builds up a credit rating but paying off in full (so as to stay out of debt and prove you can pay things on time) is a better way of doing that.
Some people even stupider think that it is better to carry a high interest rate on a credit card because the low interest rate on money in a bank will make them come out ahead (it won't, unless you have an interest free card in which case you could try some credit card arbitrage).
2007-10-17 03:03:08 · answer #5 · answered by bestonnet_00 7 · 0⤊ 1⤋
You are better off paying the credit balance in full every month if you can.
2007-10-17 01:33:57 · answer #6 · answered by Ralfcoder 7 · 2⤊ 0⤋
If you don't pay it all off you will get charged interest.
So everything you bought on that credit card that is still on the balance will end up costing you more than what you purchased it for.
It's much better to live within your means and pay off your card balances in full each month
2007-10-17 01:37:05 · answer #7 · answered by Anonymous · 1⤊ 0⤋
It's good to pay off the balance. It looks great on your credit report and you are saving a ton of money by eliminating the interest if you just made payments on the principle.
2007-10-17 01:39:01 · answer #8 · answered by Ricky H 4 · 1⤊ 0⤋
You have to pay your balance in FULL every month. This is how you build good credit history.
2007-10-17 03:10:17 · answer #9 · answered by gonzo 3 · 0⤊ 0⤋
def pay off the balance in full every month if you can. Obviously you aren't then taking full advantage of the interest free period (if you have 1) but in order to do that you'll have to have a good memory each month so personally I'd pay off in full
2007-10-17 02:32:50 · answer #10 · answered by rubyroo 3 · 2⤊ 0⤋
Pay your whole amount used every month, its better than to have a credit card debt. I'll do it every month and it helps me to feel more secure about the money that I'm spending.
2007-10-17 01:50:20 · answer #11 · answered by Cherry 4 · 1⤊ 0⤋