When is the best time to pay your credit card bill? – Money news

Defaulting on credit card payments not only results in fines and late fees, but it also negatively impacts your credit score, which plays a key role in determining your loan eligibility and interest rates. In light of this, it is important to pay your bills on time to maintain your credit rating.

Credit card users typically receive an interest-free period of 45 to 50 days to pay their bills after statements are generated. If you miss the due date, interest will begin to accrue, and the card issuer will also charge a late fee.

It is also worth noting that in this case, interest is calculated from the date of the transaction, and not from the last date of payment.

There are many benefits to paying your credit card bill on time. Paying your credit card bills on time each month will help you maintain a good credit score through a good payment history. A good credit history always helps improve your chances of being approved for a mortgage, car loan, or other financial goals.

Also Read: What Factors Affect Your CIBIL Score and How to Improve It?

So the question is, when is the best time to pay your credit card bill?

Credit card companies report your balance to the credit bureaus every month. Paying a few days before your discharge date can reduce your credit utilization. Low credit utilization helps you improve your credit score or maintain good credit.

However, if your card issuer reports a zero balance every month, it could have a negative impact on your credit score. Therefore, it may be advisable to avoid paying the full amount or to pay a few days before your statement date so that new purchases can be added to your card.

You may also consider making payments several times throughout the month to keep your balance low. For example, if your balance is close to the recommended limit of 30%, you can avoid it getting too high by paying it off. Plus, you can make payments whenever you get paid. In fact, many credit card issuers allow you to adjust your monthly payment due date, which you can set according to your due date.

Conclusion:

It’s important to pay your credit card bills on time to avoid late fees, high interest rates, and a negative impact on your credit score. By following these tips, you can pay your bills on time and avoid penalties.

Set up automatic payments, buy only the essentials, use mobile banking apps, set reminders, pay more than the minimum amount, and pay your bills on time. These steps will help you effectively manage your credit card bills and improve your financial situation.