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I never spend more than I have and always intend to pay the full balance on my credit card statements. Because the due date changes and because they are different for each card, I sometimes forget and get charged interest. I would like to avoid this by setting up auto payments.

I want to double check my thinking is correct. I have several different credit cards. I had looked at my past statements and taken note of when the due dates have been. Usually they are in a 4 day range per card. The minimum payment is always $10. So if I set up auto payments for a few days before the earliest day of the month the balance has been due on for each card and pay $10, would this avoid interest fees?

Or does it not work like this? What exactly happens if you do or do not make the "minimum payment" since you would have to pay interest if you did not pay off the full balance anyway?

As an aside, I used to work for a service provider. In training we were showed how to change the billing date for a customer and that it's in the company's interest to make it easy for customers to pay their bills. I tried asking a couple of the credit cards and they said they can't do this. Is this common?

Griftoni
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  • They may not want to do this because it messes up balances and averages. Some providers bill everyone on specific dates, others bill on a monthly basis from the date the account was open. Some do allow changing statement dates, but they don't have to. – littleadv Jul 06 '22 at 21:54
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    @Jeremy I guess it depends on the country. In the UK, having a credit card gives you a credit history, which, assuming your credit score is good, enables you to get loans/mortgages etc. – Armandas Jul 07 '22 at 07:42
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    @Jeremy I get 0.5% of my purchases via my VISA as Amazon points, you can use it on more websites than debit cards, and you get to dispute claims directly via VISA if a purchase is unsatisfactory. – towe Jul 07 '22 at 08:39
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    Also in the UK (like @Armandas) we can almost always set up our cards so that the full balance is taken automatically when due, thus never paying interest. And if your credit card gets cloned your current account can't be drained. – Chris H Jul 07 '22 at 08:49
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    @Jeremy credit cards have much better chargeback capabilities than debit which have a £100 minimum – Tim Jul 07 '22 at 09:19
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    Thanks all, in my country credit cards by default are set up to get paid off in full monthly (unless of course you don't have the funds available). But most people use debit here. I guess because we don't have this 'credit building'-culture. When you apply for a mortgage, your income and savings are taking into account. I've never even heard of credit cards being considered. Maybe they would if you would often not be able to pay them off, but that's about it – Jeremy Jul 07 '22 at 10:51
  • I am baffled. I have managed for decades with one credit card and one debit card, along with Paypal (which debits the credit card). I don't need more. – RedSonja Jul 07 '22 at 11:08
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    @RedSonja I have 2x Debit Cards, one for my joint account with my wife and one for a private account (she has her own private account as well.) Further I have a credit card for 2% cash back on all purchases, another which is 6% cash back on gasoline, 3% on groceries. Another which is 3% on restaurants. Another which is 5% on rotating categories. And another which has a $25/quarter reward if each statement is paid in full. I don't need all of them, it's just optimal over only having one and could still be improved further with diminishing returns. – David Jacobsen Jul 07 '22 at 14:17
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    @RedSonja If you shop at a particular store fairly often, it may make sense to get that store's credit card. Some stores will give large discounts if you use their credit card. – 7529 Jul 07 '22 at 15:16
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    @Jeremy: Because in general, credit cards have better rewards and better fraud protection than debit cards. – Dan B. Jul 07 '22 at 15:29
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    @Jeremy credit cards are safer to use for chargebacks. If you travel is better to use them, often debit cards do not work properly in my expirience. I'd prefer having a higher payment limit on my credit card since if you see fraud payments you can notify the bank and fix them before the money goes outside your bank account, while the same charges on a debit might lower your money temporarily and could cause issues if you wanted to make, say, a SEPA payment of significant amount. – GACy20 Jul 07 '22 at 15:38
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    @ChrisH Autopay is universal and has nothing to do with you living in the UK. The OP just doesn't know how to use it. – Brady Gilg Jul 07 '22 at 16:20
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    Needs clarification. How is "You pay the bill when it comes in the mail." not a sufficient answer to the question. – Joshua Jul 07 '22 at 17:10
  • @Joshua what is that "mail" you're referring to? – littleadv Jul 07 '22 at 19:01
  • @littleadv: When you receive the bill, you pay the bill. I've had bills that didn't come in post mail but not bills that didn't come using something that notifies. – Joshua Jul 07 '22 at 19:03
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    @Joshua was somewhat sarcastic, but even so my email is full of spam and random notifications, so I'm not going to rely on noticing anything there. Being proactive is the key, otherwise it's easy to miss and responsibility is my (and so is the interest payments and late fees) – littleadv Jul 07 '22 at 19:05
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    This question is country-specific, so it would be good to specify what country the OP is talking about. I have credit cards from EU countries and almost nothing of what is said here appears relevant. – Nemo Jul 07 '22 at 19:24
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    @Jeremy also credit cards have much better protection. If someone withdraw $1000 from credit card and you inform the bank you don't need to pay it. If it happens on debit card the money will be locked until the issue will be resolved. – Maja Piechotka Jul 07 '22 at 23:20
  • @Jeremy, in the US most people use Debit cards primarily also, a practice I stopped as soon as I had fraud trouble with a bank over 15 years ago. I get absolutely nothing from using a debit card, my credit card costs noting and I don’t pay interest. Why use something directly linked to a checking account when I can spend the banks money and owe the bank on a regular schedule? When my new debit card arrives I stick it in the lock box for the occasional ATM cash, otherwise there is no logical use to having or using one. Building credit is secondary or not a consideration at all. – quid Jul 08 '22 at 03:38
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    @BradyGilg the terminology, however, isn't. We use the term "direct debit" for all pulled payments like this, common for utility bills as well. Setup for us is really easy and offered with every statement. – Chris H Jul 08 '22 at 07:25
  • Just an aside: I once sent a large payment $5K to a CC. I thought I was done for the month. But the payment arrived too soon, so it didn't count as the monthly payment. And I didn't know that until the next month when they acted like I was a deadbeat, doubled my interest rate and charged me a $50 fee, as if I hadn't paid $5k the month before. I got rid of the card and now for years they've sent me a letter per week wanting me back. – B. Goddard Jul 08 '22 at 11:55
  • @Jeremy if your debt card is stolen, your bank account can be drained and you will have no funds and may bounce checks/withdrawals. If your CC is stolen, it is the CC companies money that is stolen. – rtaft Jul 08 '22 at 14:08
  • @rtaft: how can you drain a bank account with a stolen debit card? After three wrong guesses for the PIN, the card will be blocked... Am I missing something? – user132647 Jul 08 '22 at 15:12
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    @user132647 the PIN is copied, and the physical card is copied (or less commonly stolen). – Caleth Jul 08 '22 at 16:18
  • @user132647 not sure if it has changed as I haven't used a debt in a long time, but you used to be able to process a debt card as if it were a credit card without a PIN. On top of Caleths response, you can do just about anything using social engineering or info from a data breach. I had someone call in, pretend to be me, and change information on my CC a few years ago. Once they are in your account, they can change the PIN and mail themselves a replacement card. – rtaft Jul 08 '22 at 17:53
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    @Jeremy because in the US debit sucks. It has much worse fraud and dispute resolution. With a credit card if you dispute an amount, you can ignore it for the purposes of your bill until the dispute is settled. (it only takes a bite out of your credit limit). With a debit card, it takes a bite out of your CASH until the dispute process completes. If you were overdrawn you must cover it, tough beans if it's fraud. Some people are weirdly in denial about this, they don't care and don't think anyone else should care either. My debit card NEVER gets used. Why? I have credit. – Harper - Reinstate Monica Jul 08 '22 at 22:11

18 Answers18

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No, paying only the minimum does not avoid interest charges. If you do not pay the full balance by the due date, then you will pay interest on some or all of the total balance, depending on the terms of the card (a common method is to calculate the average daily balance and multiply that by the equivalent daily rate).

If you do not pay even the minimum balance, you pay interest but might also pay a late fee (which may also accrue interest depending on the card terms). It may also show up as a missed payment on your credit report.

The only way to avoid paying interest at all is to pay off the full statement balance each month.

If you have so many cards that you cannot reliably keep track of the payment schedules, then you either need to set up automatic payments paying the full balance each month by the due date (all of my cards allow you to make a payment on the due date or N days before), or stop using so many cards.

it's in the company's interest to make it easy for customers to pay their bills

Yes, but it's also in the company's interest for customers to not pay their bills on time, since interest and penalties are a huge source of revenue for credit card companies.

D Stanley
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  • I have never seen an option for automatic payments of the full credit card balance unless the credit card account is on the same account that has a checking/saving account. The automatic payments I'm talking about must have a fixed amount specified, they don't just know what the credit card balance is. – Griftoni Jul 07 '22 at 08:30
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    My VISA with LBB in Germany supports that. At the end of the billing cycle, a debit charge over the full amount due is incurred on the linked checking account at my local bank and booked a few days after. – towe Jul 07 '22 at 08:42
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    @towe I suspect the OP is in the US - here in the UK I can d the same as you, both with the cards from my normal bank and the one from a bank I don't use for anything else – Chris H Jul 07 '22 at 08:51
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    @Griftoni If you are always paying your money off then why do you need more than one card? – user253751 Jul 07 '22 at 09:28
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    Yes, absolutely right. For the OP, the fact that his min payment is $10 implies a very low balance ($200?) so the late fee, typically $35, is far higher than the interest he'd get hit with. But his low spending also implies the return on his efforts, using multiple cards, likely for different rewards, is also pretty low. – JTP - Apologise to Monica Jul 07 '22 at 11:37
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    @Griftoni You set up the payment from the credit card side to pull the full balance from your bank account. I have 4 cards and all 4 of them allow this method of payment. You can also schedule payments in advance, so at worst you could schedule a payment (again, from the card side) for the statement balance a day or two before the due date. – D Stanley Jul 07 '22 at 13:17
  • @towe Ah! The perks of Lastschrifteinzug (Direct Debit). Can't believe the US is so stuck in the 1960s when it comes to things like these. – YetiCGN Jul 07 '22 at 14:04
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    @YetiCGN how is that different than what the US has here? In the US, you log into the credit card's website, add in your banking information, and authorize them to pull the full statement balance from your checking account on the due date. – David Jacobsen Jul 07 '22 at 14:50
  • Because of OP's first comment to this answer. He made it seem like it was the norm that you cannot simply tell the CC company to pull the balance automatically. – YetiCGN Jul 07 '22 at 14:53
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    @YetiCGN Based on other comments, I got the impression that they were trying to set up a recurring "bill pay" from their bank account, which would have the problem that you don't know the exact amount. If you set up a payment from the credit card side (adding your bank account details) then it should work (provided the CC company allows it, which all that I have encountered to except for esoteric retail cards) – D Stanley Jul 07 '22 at 14:58
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    @YetiCGN it's not. – hobbs Jul 07 '22 at 15:25
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    @user253751 There are plenty of reasons to have more than one. First, if you only have one card and something goes wrong with it (e.g. fraud), you're stuck with zero until the replacement arrives. Second, most credit card companies offer various incentives for using them in certain ways. For example, if you use an Amazon-issued credit card on Amazon, you get discounts, while some other card may offer bigger discounts on, say, flights. I imagine there are more reasons, but I'm no expert. – amalloy Jul 07 '22 at 20:51
  • @DStanley Many online bill pay services also support E-statements, where the bank fetches the statement from the service provider and pays the bill. I've used this in the past, but it's sometimes flaky, so I've switched most bills to the "pull" model. The exceptions are the ones that have the same amount each month, like my condo fees. – Barmar Jul 08 '22 at 13:34
  • @user253751 I have multiple cards for the cash back. Each different card gives 2, 3, or 5% back on different spending categories. Also, they each gave 200 back for spending a certain amount in the 1st 90 days. They all automatically debit the statement balance on the due date from my bank account. – jacknad Jul 09 '22 at 00:56
  • @jacknad ah - the pain of extracting maximum money from capitalists – user253751 Jul 09 '22 at 11:54
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In the UK the system is called Direct Debit and has existed for decades; the credit card company (or any payee) submits a request to pay the owed amount directly to your bank and your bank pays it, provided they have your signed agreement to do so. The amount can be variable, although there is surprising lack of clarity explaining this. I've set this up and don't think about it anymore. Availability of direct debit to pay bills to well-known institutions is more or less universal in this country.

Tom W
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    The same feature is available at the American banks I use (though it’s simply called auto-pay, and is a button you click on the web page). – RonJohn Jul 07 '22 at 22:57
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    "Availability of direct debit to pay bills to well-known institutions is more or less universal in this country." and I guess mostly everywhere across Europe. I've lived in different European countries and have never had to care about any payment; from credit cards to mortgages, rent, utilities, car loan, .... – Diego Sánchez Jul 08 '22 at 09:48
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I apply the K.I.S.S. principle and pay all my credit card balances at the end of the month, no matter the due date.

Benefits:

  • I pay for things in the month I buy them.
  • I'm never charged interest.
  • It doesn't matter if I forget the official due date.

The banks don't care that I don't send payments on the due date, as long as they get their money before the due date, and EOM is always before the due date, even if the due date is the 28th (since this month's EOM is before next month's 28th).

Robert Longson
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RonJohn
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    This is a good strategy that works well if there's always a clear month to pay for a transaction once it's been made. But with some cards, the payment falls due a week or so after the statement date, and the statement includes all transactions up until that statement. So if you pay off 100% balance on the 31st, then use the card on the 1st, and statement is issued on the 2nd, payment may be due on the 16th, and if you don't pay until the end of the month you'll get charged :( – psmears Jul 07 '22 at 09:33
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    @psmears: Your example is better than your explanation, although still not realistic for the US, where "Credit card companies must establish procedures to assure that their bills are mailed or delivered to you at least 21 days before the payment is due." (from consumerfinance.gov) – Ben Voigt Jul 07 '22 at 15:36
  • @BenVoigt: I wonder if you're maybe misreading? I haven't given an explanation, only some background and an example. But I'm glad the example made sense :) I'm not sure how the rule you quote makes this problem unrealistic in the US though: 21 days is well short of a month, so if the timing is wrong the same issue can be hit, unless there's guaranteed to be a delay between a transaction and the statement, or some other rule about when payments can fall due... – psmears Jul 07 '22 at 17:31
  • @psmears: You were right about "short of a month" but your comment text said "the payment falls due a week or so after the statement date" which is wrong by a factor of three, and your example gave 14 days which is still too short by a week, minimum. – Ben Voigt Jul 07 '22 at 17:54
  • @BenVoigt: The timing isn't wrong; that's what some of my cards have done! The timings may be different in different locations, though, sure ("or so" = "approximately" fyi). But unless there's a whole month allowed for payment, or another constraint that means it can't happen, then this issue is absolutely realistic for the US, albeit with lower probability of happening, granted. – psmears Jul 07 '22 at 18:21
  • @psmears your concern has not been valid since Web 2.0 has let you kog into your bank’s website, see your balance (including pending items), and then click Pay. Either that, or Chase is just better at banking than other banks… – RonJohn Jul 07 '22 at 22:54
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    The point made by @psmears is quite valid, although it's not the statement date that matters, so much as the billing cycle. You have a billing cycle date, a statement date, and then a payment date. As Ben Voight notes, the payment date must be at least 21 days after the statement date, but that possibly leaves a small window to be late if there's a really small gap between the billing cycle and the statement date. – Acccumulation Jul 08 '22 at 01:45
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    Suppose your billing cycle runs from the 3rd of each month until the 2nd of the next, and your statement date is the 6th of each month, and your payment date is the 27th. If you pay on the 30th, then charge something on the first, then your payment will be late. I don't know whether cards have this short of a span between billing cycle and statement date, but it is theoretically possible. – Acccumulation Jul 08 '22 at 01:45
  • @Acccumulation: Maybe it's different in the US, but for the cards I've had, the statement date is at the end of the billing cycle (and hence there are only two dates that matter, because billing cycle date = statement date). – psmears Jul 08 '22 at 06:51
  • Pay off each card when you get paid, then you will never have to worry about due dates. – rtaft Jul 08 '22 at 14:15
  • I do the same thing. – Dan B. Jul 08 '22 at 22:58
  • @Acccumulation your comments seem to indicate that people must pay CC bills on the due date. That’s just not true. You can pay any time you want, as long as it’s on or before the due date. – RonJohn Jul 09 '22 at 04:22
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    @RonJohn I don't see how my comments suggest that. 30 is after 27. Perhaps it's clearly if I include months? Suppose your billing cycle runs from the 3rd of each month until the 2nd of the next, your statement date is the 6th of each month, your payment date is the 27th, and you pay every 30th. If you charge something on the 1 August, then that will go on the billing cycle that ends on 2 Aug, and will go on the statement issued 6 Aug. This statement will give a balance that is due 27 Aug, but you won't pay it until 30 Aug, which will be overdue. – Acccumulation Jul 09 '22 at 04:43
  • @rtaft That works if you're paid biweekly, but some people are paid monthly or even less frequently. – Acccumulation Jul 09 '22 at 04:44
13

Everything is set to autopay in full. I have most every account also set to send me an e-mail for any charge over $0.

Loren Pechtel
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    How do you have an option to 'auto pay in full'? Are all your credit cards with banks that you also have checking/savings accounts with? How do they know what the credit card balance is to pay? – Griftoni Jul 07 '22 at 08:31
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    @Griftoni You tell the credit card company to autopay "statement in full" or "statement balance" (not minimum balance). I assume you're thinking from your bank's autopay side, you don't set it up that way. – pboss3010 Jul 07 '22 at 12:39
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    @Griftoni you set up auto-pay with the credit-card issuing bank to pull the payment from your checking/savings account (which might be with a different bank). – brhans Jul 07 '22 at 12:39
  • I've used at least one bank whose online offering allowed bills to be delivered directly to the bank, and you could choose to pay the entire bill as an automatic payment. I never opted to do so, as I didn't want something as variable as my credit card balance to be scheduled without explicit action on my part. – chepner Jul 07 '22 at 17:13
  • (Maybe it was really agreeing to allow the biller to pull a payment from the bank, but handled via the bank's online system. I never looked too carefully.) – chepner Jul 07 '22 at 17:17
  • cool story, bro. – Harper - Reinstate Monica Jul 08 '22 at 22:13
  • What country are you guys in? I'm in Canada. My credit cards don't have an autopay option unless the account paying is from the same bank. – Griftoni Jul 13 '22 at 05:29
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    @Griftoni USA. Any decent credit card has the option to provide a bank account and take the money out on the due date. – Loren Pechtel Jul 13 '22 at 15:18
  • @Griftoni That’s means your bank has a crappy website. Get a card from a better bank. – Navin Jul 15 '22 at 05:08
  • I would have loved an option “pay everything but not over 200 pounds”. – gnasher729 Nov 09 '22 at 20:53
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You are allowed to change the due date for your credit cards. Last year I decided to change the due dates for all 7 of my credit cards to be the same date, because I too occasionally forgot to pay off a credit card on time.

(Helpful tip: if you almost always pay a credit card off on time, and then you are late on a payment, call the credit card's customer service and ask them to waive the late fee and interest. I have done this a few times and they have always credited the late fee and any interest back to my account.)

Now all of my credit cards have a due date of the 2nd of each month, and I have an end-of-month calendar reminder to pay off my credit cards.

Important note: Before you go about changing the due date of your credit cards, make sure you are 100% certain about the new due date. One of my credit cards told me that I could only change the due date once every 5 years.

7529
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  • Manual bill payments are so 2002! Automate it all and ignore the due dates. – RonJohn Jul 09 '22 at 05:43
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    It hasn't happened often, but a few times I needed to dispute a charge on a credit card. I've seen conflicting information on whether or not you are allowed to dispute a charge that you have already paid. That's why I haven't automated any payments. – 7529 Jul 09 '22 at 05:49
  • Then add the manual step of logging into the bank’s web site to pay that portion of the bill which you think is valid. – RonJohn Jul 09 '22 at 16:05
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If you make the minimum payment on time you avoid a late fee. You pay interest on any statement balance remaining after the due date (terms/calculations can vary).

I have a google sheet with a list of due dates and an indicator of whether or not they have been paid (yellow = scheduled, green = money left my account). I do this for automatic payments too, just in case something goes wrong it doesn't go unnoticed for too long.

My credit cards offer 'automatic payments' and can be the minimum due or statement balance. I typically do the automatic minimum due well before the due-date since my credit card balances vary wildly month to month I like to review rather than auto-pay full statement balance.

I thought choosing a due date was pretty common, but have no data on the topic. It makes sense that it varies by bank/product.

Hart CO
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  • I have never seen an option for automatic payments of the full credit card balance unless the credit card account is on the same account that has a checking/saving account. The automatic payments I'm talking about must have a fixed amount specified, they don't just know what the credit card balance is. – Griftoni Jul 07 '22 at 08:30
  • My CC also has automatic payments. The CC company simply withdraws what is due from my bank account. The only catch is that the default is only 10%, so you have to get that changed to 100%. But maybe that is something that is not as common in the US as it is here in Europe – Manziel Jul 07 '22 at 10:03
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    @Griftoni what credit card merchant doesn't let you select for an automatic payment of the full statement balance to be automatically paid? I have cards from American Express, Bank of America, Wells Fargo and Discover. In the past I have had card from Chase and Citibank. All of them allowed for an automatic payment in the full statement amount, and setting up that automatic payment is basically the standard. If your card doesn't allow that, I'd close it and get another one. – David Jacobsen Jul 07 '22 at 14:48
  • @DavidJacobsen to name one that doesn't, Scotiabank Momentum. Maybe it's not common in Canada. – Griftoni Jul 13 '22 at 05:31
4

How do people with multiple credit cards keep track of their due dates and not miss payments?

Well, the first step is to assess why the heck do you use so many cards and inflict this problem on yourself?

I have well over 10 credit cards which I've signed up for to take advantage of various sign-on bonuses like 30% off a purchase for a store card, or $200 cash back when you spend $1,000 in the first 3 months, etc...

Most of them sit peacefully in a little box and expire silently as the years roll on.

Never, never, never do I ever try to juggle rotating cash-back perks like one card is great for gas, one card is great at restaurants, one card is great at Amazon, etc...

If you're juggling for perks then you are playing directly into their trap by not having a sole source of information about your spending; this often leads to overspending.

I have a decade-old CC which used to be my main but now I just keep it alive via automatic bill pay for Internet for the credit history longevity. I have a fairly new main CC which I use for all other things. A $10k+ limit on both CC's guarantees me peace-of-mind if I ever had to make an unexpectedly large transaction.

MonkeyZeus
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4

Set auto-pay to minimum, but manually pay the full amount.

This is a "Dead Man Switch". If you do nothing, the minimum payment auto-fires, and makes sure your payment is not late, so you avoid penalties for that.

Of course, paying less than full means interest happens if you fail to pay in full... but that is the choice you say you want, for cash flow reasons. I think that's reasonable, and I do it myself.

"Wait. How does the bank know what my minimum payment is?" It doesn't. Auto-pay is not a "Push" thing from the bank to the credit card. It's a "Pull" thing - the credit card issuer initiates the withdrawal from your bank account, and the bank trusts the credit card company. So you set up auto-pay with the credit card, not with your bank.

It's not hard for the bank to authenticate that EFT as legitimate, since it's coming from a major bank like Chase or Capital One, who will make good any mistakes.

If you find that creepy and don't want to give the CC your bank info, that is fine by me... I felt the same for many years but relented when I just didn't have the time to deal with it by hand anymore. Of course NOW, you can do "push" payments from the bank to the credit card, via services like Bill Pay. But that requires you to guess your minimum payment.

For most banks, manual payments you make before the auto-pay date will reduce the auto-payment. If the minimum auto-pay is $300 yet you paid $200 manually, the auto-pay will fire at only $100. If you had paid $500 manually, the auto-pay will be $0 that month. (that is usually the case for me). However not every card does this.

Most banks will change your due date, if you ask.

So talk to a human (or sometimes you can do it on a website) and ask them. Setting it 15 days after your rent or mortgage pmt is not a bad idea.

Harper - Reinstate Monica
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  • In the US, beware of limits on savings accounts to only 6 withdrawals a month. This was previously mandated by Federal Regulation D, up until 2020 when they suspended/revised it during Covid; however many US banks still impose some limit on number of withdrawals from savings accts. Check. https://www.bankrate.com/banking/savings/regulation-d/ – smci Jul 12 '22 at 19:34
3

I have autopay set up on mine in different ways, in conjunction with their purposes.

  • My card I use primarily for online purchases I have set up for autopay for the minimum, as it has highly variable amounts and also needs the most scrutiny
  • My card I use for Costco I have set up to autopay the full amount, as it has fairly consistent, low amounts, only a few transactions, and a low maximum as well.
  • My card I use for most in-person payments I also pay the minimum auto-pay.
  • My "backup" card that is set up as my auto-failover for checking I auto-pay the full card amount (but it's always zero - if it were to get used due to having something odd happen with checking, I'd be alerted when it is used, and fix it then).
  • My two "store" credit cards autopay the full amount.

Monthly I review each card, all at the same time (regardless of payment deadlines). The two I autopay the minimum, I then schedule full balance payments at that time. The others I verify that the amounts are reasonable (the store cards I usually have zero balance on, as well as my backup card) and let auto-pay handle them.

The auto-pay-minimum allows me to guarantee I don't miss a payment (and get a negative mark on my credit history) if something happens and I forget to evaluate a card, but obviously I want to avoid interest, so it's important to look every month (in addition to being important for just knowing what's going on and catching fraud).

Joe
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  • How do you auto pay the full amount of a credit card? I have only seen this option if the card is from the same bank you have a checking/savings account with. – Griftoni Jul 07 '22 at 08:32
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    Depends on the credit card, I suppose, but all of mine have the option to autopay "minimum due" or "statement balance" (what I mean by "full amount"). – Joe Jul 07 '22 at 15:51
  • The key is to not let autopay make you lazy. You want to catch fraudulent charges before they autopay, otherwise you might as well use a debt card. – rtaft Jul 08 '22 at 14:19
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While you can certainly set up auto-payments there are other ways to avoid paying interest. The main mistake in your logic is that you are overly concerned about the due dates. Pay on your own schedule. The credit card company has to issue a statement roughly a month before the payment due date. Depending on the relative grouping on your payment due dates you can pick either one or two (15 days apart) days of the month where you can go online, look at your credit card statements and schedule your payment for the full statement amount. You do not have to pay the full amount up to the due date to not pay interest. Only the full amount on the last statement.

SunKnight0
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The most manageable method from my experience would be to regularly check online and pay off all your credit cards in an interval that is short enough to never miss any given due date.

For example, in my case, I'd check all my cards at least once a week (and paying in full when there's any amount lower than the credit limit), even with the "payback time" of one month, regardless of whether or not I remember if any particular card had been used.

plu
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    Yeah, same. I reconcile my transactions every 7-14 days and pay credit cards then. If you're making multiple payments a month and you're bringing the balance to zero when you do, it doesn't really matter when the payment due dates are. – Brendan Jul 07 '22 at 12:23
  • Yep, part of my weekend routine – littleadv Jul 07 '22 at 19:02
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Because the due date changes

That's quite weird. Maybe they could vary by a day or two due to 1/12 of a year not being exactly equal to 30, but I don't see why they would vary by four days.

So if I set up auto payments for a few days before the earliest day of the month the balance has been due on for each card and pay $10, would this avoid interest fees?

Other posters have been saying that if you pay off your bill, you don't pay interest on that month's charges, but I don't think that's quite right. My understanding is that if you don't have a balance at the beginning of the billing cycle (i.e. you paid of the last bill entirely), then you don't get charged interest on this billing cycle's charges, if you pay them off by the due date. Also, this isn't a legal requirement, just a common industry practice.

What exactly happens if you do or do not make the "minimum payment" since you would have to pay interest if you did not pay off the full balance anyway?

If you don't pay the minimum payment, you get charged a service fee.

I tried asking a couple of the credit cards and they said they can't do this. Is this common?

My understanding is that it's rather uncommon. Maybe they thought you were asking to change the billing date for charges that were already made? When you change the billing date, it doesn't apply until at least the next billing cycle, possibly not until the billing cycle after that (and since the billing date is at the end of that billing cycle, you have the rest of this billing cycle, plus all of the next billing cycle, until it takes effect).

As for how to keep track, besides changing the due date, you could put reminders on your calendar (phone and/or computer, or Outlook if you have that), get in the habit of checking a particular day of the week, paying ahead of time, or set up autopay.

Acccumulation
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    (1) assuming US (because people who think their country and currency are the only ones to exist are 99.9999% US) IME billing date variation is almost always to avoid weekend or holiday; 1-2 days is fairly frequent (about every third month) and 3-4 days is rarer (when you hit a 'long weekend'). Though two of my cards have normal dates of 25 and 27 and in Feb shift several days earlier though they don't strictly need to. (2) yes the actual rule is pay month N on time get no interest N+1 if also on time, but simpler to say if you pay all months on time you get no interest all months. – dave_thompson_085 Jul 08 '22 at 03:21
  • "If you don't pay the minimum payment, you get charged a service fee." - This severely understates the potential consequences of missing a minimum payment. – Brian Jul 08 '22 at 13:13
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How do people with multiple credit cards keep track of their due dates and not miss payments?

The question title has two parts. Here's how I personally do it:

How do I keep track of my due dates? I don't.

How do I not miss payments? I have it set up to auto-pay the full amount before the due date.

Prateek
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It sounds like your misunderstanding comes from trying to set up automatic payments the wrong way. All of the credit cards that I have used have an option, on the credit card's web site, to set up "auto-pay."

You have to enter your bank account details (account number and routing number), and then it asks you if you want to pay the bill in full, pay the minimum payment, or some fixed value. It also might prompt you to select whether to pay as soon as you're billed or on the due date.

In order not to get charged any interest fees or late fees, you should select to pay the bill in full. Whether you pay right away or on the due date is up to you and shouldn't affect anything.

In this way, whenever you owe a credit card balance, the credit card company will take the money from your bank account (using the details you provided), on the day you specified, and you will never be late. If something happens that isn't your fault (a glitch in their system, etc) that is their problem to fix, and you still won't get charged late fees (and if you do by mistake, they will refund them because it was their fault).

I have all of my cards set up this way. You only have to do it once for each card, it's super easy, and my payments are never late!

Esther
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For each of my credit cards, I have the credit-card issuing bank automatically debit my checking account for the minimum payment due on the due date for that card. This ensures that as long as I have enough money in my checking account I'm never late for a payment.
Note that this is something I configure in the online portal of the issuing bank for each of the credit cards individually, and not something I configure with my 'main' bank where my checking account is held.

Then I choose some convenient day in every month - typically on the 3rd weekend (when I know that all my utility bills, mortgage, car loan, etc have all been paid), and I log in to each of the credit card issuing banks' online portals and make an additional payment to cover whatever is still due for the most recent statement period (or sometimes when I know I've made a large purchase that I'm planning to pay off over a couple of months on one of my lower-interest cards I decide on the amount of the partial payment).
Depending on the specific due date for each card, this manual payment might end up 'cancelling' that minimum auto-pay that I have set up - but I have the peace of mind from knowing that even if something happens and I forget or am not able to perform my 3rd weekend manual payment that minimum amount will always be paid and I won't get punished with a missed-payment fee or hit to my credit report.

I'm aware that sometimes I do end up carrying a balance over for a month or 2, but since my spending averaged over time doesn't exceed my income I just regard the small amount of interest I pay as a "convenience fee" for allowing me to make the occasional large purchase and not have to balance everything down to the last cent every month.
This behavior may not work for everyone though as it requires a general awareness of how your spending levels track your income and the discipline to not out-spend yourself all the time.

The way you seem to be currently managing your payments is through a push from your primary account over into your credit card account(s), whereas what I do is a pull, initiated from the credit card issuing bank.
This works for me because I don't have to track the minimum amount or the due date to avoid those late payment penalties.

brhans
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People with many credit cards can manage this effectively using several approaches, sometimes in combination:

  1. Setup autopay.
  2. Setup payment due notifications and manually respond to them.
  3. Manually log in to all accounts a couple times each month and manually make payments on accounts that are due. Just twice about two weeks apart is enough to guarantee you'd always have logged in before a payment due would be late.
  4. Change all your statement generation dates or payment due dates to the same or close to the same. Some providers let you pick a payment due date and adjust statement dates, some let you pick a target statement date with your exact payment due date varying depending on when statements actually generate. Then you can just do #3 once a month.

As for interest, generally, you are not charged interest unless you are carrying a balance beyond a statement period. For example, if your balance is zero, then at the start of a new statement period N, you make a purchase, you won't be charged interest at statement N + 1. Instead, the earliest you'd be charged interest is at N + 2. So, if you're just losing track of your statement date, then you can easily avoid interest by zeroing your balance then waiting until a new statement to make future charges.

Also, as a reminder, interest charges are based on statement dates, not payment due dates. So you can still end up with interest charges even if you're making payments before your payment due date.

Minimum payments depend on the statement balance and a variety of other factors. So, you cannot count on the minimum payment being at most $10. And like mentioned, making payments before your due date isn't for strictly avoiding interest but avoiding being late.

There are numerous ways to keep track. Paper statements, electronic statements, notifications of statements and payment due, email services that automatically create calendar events from such emails, your own manual calendar events to check all your card accounts, third party services that aggregate all your accounts and send you their own notifications, alerts, calendar invites, etc for statements and payments due - or even will let you connect your bank account and make payments on your behalf.

iheanyi
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Pay on the same day every month

I pay all of my bills on the same day each month (or rather, within a couple days of the same day each month). This works for me because all of my bills either have due dates after that day of the month. I keep track of what bills I have and when I paid them in a simple Excel spreadsheet (this is fixed throughout the year for the most part) [ I also keep track in Quicken]. I pay from my bank's online BillPay system, and get most of my bills through that system as PDFs. For bills which aren't available through my bank's BillPay, I log into the appropriate website and grab the bill. I also have bill amounts available via Quicken's bill service. This takes me about 30-60 minutes every month (between downloading PDF bills, setting up payments, tracking in Quicken and Excel, etc).

I prefer explicitly sending money out of my bank rather than having the biller debit my bank account. This is partly psychological (I see the money going out) and partly practical as I don't want the biller to accidentally mischarge me and be out that money in my bank account. I will, however, have billers automatically charge a credit card when they offer that service (with no fee).

Change your payment date when needed

The key to this working is getting all your bills to have similar payment due dates. For me, this mostly worked out by chance, but many card issuers will let you change the payment due date, and they typically limit this to one change per year or something similar. You can also call your utility providers and ask to change the due date on those bills.

Find a date which works for you (maybe you get paid on the 15th and 30th, so you could aim for all your due dates to be around the 20th of the month). For some bills, you may wind up paying quite early - my mortgage due date is the 1st of the month, for example, but I just pay it around the 15th of the month before...no problem at all. Whatever date you choose, make sure it is after the close date / statement date for any variable bills (i.e., except mortgage and car loans) - you need to know how much to pay.

It will take a couple months to get all of the dates adjusted, and may require paying some bills more often than usual at first (to get the new date set up) or much earlier than expected (to "get ahead" of the due date). Once it's going, it's very easy to remember though.

mmathis
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In a country with a traditional monthly (instead of weekly) salary payment:

Bills (including CC interest-free payment dates) are all aligned with the common paydays.

You get your salary. You pay all bills (rent, electricity, water, internet, phone, car lease, other credits payments, etc...) a day or two after.

CCs are paid last because you can pay less than the full amount if the month is not good.

Some money left? Good, ...but check twice for something missed.

fraxinus
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