When is the Best Time to Pay Your Credit Card Balance in Full?

by Lynnette Khalfani-Cox, The Money Coach on April 15, 2011

in Credit Cards


If you’ve finally saved up enough money to pay off your credit card balance in full, or only charged a certain amount that can be paid off before the next billing cycle, make sure you time your payment right or you could end up paying some interest charges. One of the first things you need to do when you’re ready to pay off that balance is determine when your billing cycle ends. Many people wait until the very last day of their statement date, but soon find that they incurred interest on their old balance that gets posted on the next month’s statement.

Timing Your Credit Card Balance Payoff Date

Timing your credit card balance payoff date can help to avoid incurring these extra interest charges. Pay your balance off at least one week in advance of the due date, preferably as close to the beginning of your billing cycle date as possible. Timing your credit card balance payoff date in this way can reduce the chances that you will incur interest charges and will help you begin the next billing cycle with a clean slate.

Reasons to Pay Your Credit Card Balance in Full

If you don’t have a very high credit card balance, is it really that important to pay it off in full? That depends. If you have the money available to clear off that balance and are subject to an interest rate – that is, you’re not carrying a balance on a 0% APR credit card – pay it off as soon as you can.

Carrying a balance that is subject to interest will continue to cost you. If you are carrying a balance on a 0% APR credit card, you have some room to continue without paying it off entirely, but make sure you do pay it off before the promotional rate ends. In many cases, the default rate is much higher than average credit card interest rates and you could end up paying a high price for all those credit card purchases you have already made.

Some other reasons to pay your credit card balance in full:

  • Improve your credit score
  • Stop worrying about making monthly payments on time
  • Eliminate the chances of incurring late fees or interest charges
  • Increase your chances of getting a rate reduction in the future
  • Improve your debt-to-income ration
  • Improve your chances of getting better credit card offers in the future

Paying your credit card balance in full – at the right time – can help to improve your credit standing and also reduce some anxiety about your finances each month. Make sure you time your credit card balance payoff date so that you don’t end up paying extra fees and charges.

This Article Answered The Following Money Questions:

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