Paycheck Chronicles

One Small Step to Improve Your Finances


One place where I occasionally make a mistake with my finances is paying the credit card bills.

We have two cards that we use regularly, plus we have a couple of cards that we don't use - a military Star card, my husband's American Express, and I have an extra Mastercard. (Living overseas means that sometimes you need more credit cards than you think.)

I pay all the bills online by making manual transfers.  Once every couple of years, I will forget to make the payment by the due date.  In the past, this was a minor inconvenience, as our cards are all with reputable companies and they've never assessed any nonsensical fees because of my slips.  One time, however, my husband's interest rate went up from 7.9% to 9.9% because I didn't pay his bill on time.  I hadn't set up automatic payments because I like to pay the whole balance, but I'm not always exactly sure that there is going to be enough money in any single account.  This is especially true if we are traveling or PCSing.

Fortunately, I've figured out a solution that works.  I have set up all my credit cards to automatically debit the minimum payment from my checking account on the due date.  The minimum payments aren't much, so I'm not in danger of overdrafting my account by making the minimum payment, but it makes sure that a payment is made.  So far, it has worked great!  I can still pay more manually, but the minimum payment will always be made, no matter how crazy life gets or how forgetful I may become.

If things are disorganized enough that you forget to pay, having that minimum payment made shouldn't be a huge problem for your non-bookkeeping, but it might save you a late payment fee or an interest rate hike.

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