Paying Credit Card on Time Saves Money and Reputation

Paying a credit card on time will save you money and it will save your reputation with the credit card company.

By paying a credit card on time you save on interest because with some credit cards the interest accrues each day and if there is an unpaid amount owing, the interest on that makes next month’s minimum payment that much more.

If at all possible, if you pay off just a few dollars more each month than the minimum owing, you will be very pleasantly surprised at how fast paying your credit card debt will happen. Ideally, of course, you should be paying the total amount off each month but that isn’t always possible. But if you are just using your credit card for what were once known to be “running around expenses” and you haven’t bought any large purchases, then if you are budgeting well, these small uses should be coming out of your budget.

Credit cards were once only used for large purchases.

Historically, the credit card was invented for people who just wanted to borrow a small amount of money to buy a fridge or a washing machine. These larger purchases were able to be paid off in a short amount of time. Originally, the credit card was not designed or intended by the banks to become a daily usage monetary system in place of cash.

Once people started having all their wages and salaries paid directly into their bank accounts; which occurred because of the convenience factor and because it stopped the pay-roll robberies, people then started to use their credit cards to make smaller purchases when they didn’t have the cash on them to pay for something. These smaller, unpaid amounts on credit cards, started to return a serious amount of interest based funds back to the banks so they started to encourage more and more use of the ‘plastic money’ because it increased the banks bottom line substantially.  Hence today, most banks around the world regularly announce profits in the billion dollar vicinity each year.

These Billion dollar profits substantially originate from people who don’t or who are unable to pay off a credit card fully each month. Paying a credit card that has many small amounts charged against it, should be easy to pay if you can regularly pay it off every month.

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