How to Handle Credit Card Payments Like a Boss

If you make your credit card payments on time every month and handle all your loans responsibly, you’ll likely build solid credit and could enjoy low interest rates. If you don’t make on-time payments, late fees and penalty interest rates may come your way — and your credit score could take a hit.

Discover it® Chrome Student Card

Get cash back on gas and restaurants with Discover it® Chrome.

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome.

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome.

Earn 2% at gas stations and restaurants on up to $1,000 in combined purchases each quarter.

Our Student Credit Card

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome 

Earn 2% at gas stations and restaurants on up to $1,000 in combined purchases each quarter. 

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome

Get cash back on gas and restaurants with Discover it Chrome for students. Go for it.

How much you pay matters, too.

With stakes this high, it helps to know everything you can about how credit cards work. Here’s a complete guide to acing your monthly payment.

1. Take Advantage of Free Alerts

The first step to solid credit is making sure you never miss payment. With Discover, you can sign up for alerts such as payment posted, statement available and minimum payment due. You can also set up alerts or reminders to track your spending, protect your account and even to be reminded about rewards and offers.

2. Pay Electronically

Hands down, the best way to pay your credit card bill is via electronic payments through your card provider or bank — they’re fast, reliable and don’t require hunting for your last Forever Stamp. Most card issuers offer a way to automatically debit your bank account each month.

3. Pay on the same day every month

According to the CARD Act of 2009, credit card bills must be due on the same date each month, so at least these dates will be predictable. 1 Plan on paying your card on the same day each month to avoid possibly missing a payment.

If you pay late, you may be incurring costly late fees. And of course, your credit will suffer if you get into the habit of making late payments. But if this does happen accidentally, you may be able to contact your card issuer and ask to have any late charges waived as a courtesy.

Discover it® Chrome Student Card

Get cash back on gas and restaurants with Discover it® Chrome.

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome.

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome.

Earn 2% at gas stations and restaurants on up to $1,000 in combined purchases each quarter.

Our Student Credit Card

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome 

Earn 2% at gas stations and restaurants on up to $1,000 in combined purchases each quarter. 

Sponsored

Get Cash Back on Gas and Restaurants with Discover it® Chrome

Get cash back on gas and restaurants with Discover it Chrome for students. Go for it.

4. Pay More than the Minimum Payment

The best way to manage your credit card accounts is to avoid interest charges by paying each month’s statement balance in full and on time. If you get in this habit and pay on time every month, you should not have to worry about late fees.

But if you have to carry a balance occasionally, how much you pay will be very important. When you can’t pay your balance in full, try to pay as much as possible because it will minimize the interest charges applied to your account. At the very least, pay the “minimum amount due”. If you pay below that, you’ll still be responsible for late fees and might still have to deal with a penalty interest rate.

Here are some quick terms to help you understand payments:

  • APR (Annual Percentage Rate): Also known as your interest rate, this interest rate determines the finance charges you pay on your account.
  • Billing Cycle: The length of time (typically 28 – 32 days) between your statements
  • Late Payment Fee: A fee charged when a payment has not been received by the specified due date.
  • Minimum Amount Due: The smallest payment a customer can make each statement period to keep the account in good standing. If you only pay the minimum payment, you will incur interest charges on the unpaid balance.
  • Penalty APR: A higher APR the credit card company charges on new transactions, after the customer has made late payments, or otherwise did not abide by the Cardmember Agreement. If you become more than sixty days late, some credit card companies may apply the penalty APR to your existing balance.

Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.

Up Next  

Video: What Are the Benefits of Using a Credit Card?

Explore More Topics:

You Might Also Like...

Get cash back on gas and restaurants with Discover it Chrome for students. Go for it.