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Settle Smart: How To Do Credit Card Payment
By: David Riewe
The first step in doing a credit card payment is to understand your monthly
billing. The following are terms you will encounter:
Statement date – The date that the bill was printed.
Payment due date – this is the day that the cardholder must pay any outstanding
balance. Payments made after the said date will be credited, but will also be
fined a lateness fee.
Total Amount Due – It consist of the unpaid amount from the previous month, as
well as purchases, payments and interest charges for the current month. When the
cardholder pays this amount on or before the payment due date, no interest
charges will be imposed.
Minimum Amount Due – this is a smaller fraction of the total amount due. To
maintain a good standing with the card company, pay at least this amount, if you
cannot afford to pay the total amount due.
Finance charge – if the cardholder is not able to pay the total amount due, then
he is charged a fee for borrowing money from the company. It is calculated based
on the interest rate of the card. For detailed information on how this is
calculated, go to http://www.abcguides.com/creditcards/cci_faq.htm#finance_charges.
Late charges – Paying or not, after the payment due date, is penalized with late
charges. Avoid this as much as possible as this is almost 2X the interest rate
of the finance charge. Consistently missing payment may lead to cancellation of
the card and a bad credit standing.
Having understood the information on your monthly bill, here are simple
strategies for paying your credit card charges:
Always pay the total amount due. Paying only the minimum amount due means being
charged for a high interest rate on the unpaid amount.
If you cannot pay the total amount due, pay as much as you can above the minimum
amount due. This strategy aims to reduce the finance charges that you have to
pay for settling partially.
Do partial payments as early as possible (as soon as you receive the billing).
Finance charges are based on the unsettled amount and the time it remains
unsettled, so the shorter it is, the lower it will be for finance charges.
Some card companies reward loyal cardholders by accumulating points for their
spending. Check if reward points can be credited back as payment.
Lastly, pay the total amount due. Just to emphasize the point!
There are many avenues to pay your card bill. There’s the traditional way of
waiting in line, or the faster way of paying electronically through your
computer, cash machine or mobile phone. With all these conveniences at hand, it
is quite unforgivable to miss your payment due date.
Therefore, settle smart: pay the total, pay on time.
About the Author:
David Riewe is a Publisher and Online Marketer. Visit his Credit Resources Blog
Below:
www.push-button-online-income.com/creditcards/
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