7 benefits of paying your credit card bill before the due date (2024)

FAQs

Is there any benefit to pay a credit card bill before the due date? ›

Paying your credit card early could help your credit score

By making an early payment before your billing cycle ends, you can reduce the balance amount the card issuer reports to the credit bureaus. That means your credit utilization ratio—the total percentage of available credit you're using—will be lower as well.

When you make a payment before your billing cycle due date, the balance owed will be reduced by the amount of your payment from the day it is posted. This will, in turn, reduce the overall amount used to calculate your interest every day for the remainder of the month.

Bottom line. Paying your credit card bill early is not intrinsically good or bad, but it can help you avoid negative habits such as high credit utilization and late payments. Paying your credit card early won't directly influence your credit score, but it can help in creating good financial habits down the line.

Save money on interest

If you are unable to pay your credit card in full, you will be carrying a balance over from one billing cycle to another. That balance will start accruing interest. Paying early in the next billing cycle will help to lower the total amount of interest that you will pay on this balance.

When you have a credit card, most people usually make one payment each month, when their statement is due. With the 15/3 credit card rule, you instead make two payments. The first payment comes 15 days before the statement's due date, and you make the second payment three days before your credit card due date.

To avoid paying interest and late fees, you'll need to pay your bill by the due date. But if you want to improve your credit score, the best time to make a payment is probably before your statement closing date, whenever your debt-to-credit ratio begins to climb too high.

Paying your balance more than once per month makes it more likely that you'll have a lower credit utilization rate when the bureaus receive your information. And paying multiple times can also help you keep track of your spending and cut back on any overspending before you fall into debt.

Bottom line. If you have a credit card balance, it's typically best to pay it off in full if you can. Carrying a balance can lead to expensive interest charges and growing debt.

When you pay your credit card weekly, it can reduce your credit utilization and improve your credit score. Paying weekly also makes it easier to stay on top of your spending and stick to a budget. It's more convenient to pay monthly, especially because credit card companies don't have a weekly autopay option available.

You can make part payments on Credit Card bills, regardless of the bill amount. If your amount is relatively smaller, you can make partial payments and potentially minimise interest accumulation.

What happens if you pay before AutoPay? ›

If you make a full monthly payment before your due date, AutoPay won't process for that billing cycle. If you make a smaller payment that isn't enough to pay the full amount due for the month, AutoPay will still process the full monthly amount due on your account.

It means you have more money available on your credit card for other purchases or an emergency. If you pay off large purchases shortly after you make them, you have access to that amount of credit on your card again.

Potential for unfair settlement offers

For the debtor, these benefits are usually a lower interest rate. If you pay early, you might be hit with a fee to somewhat make up for the advantages you have gotten and that the creditor is losing.

Yes, you can pay the credit card bill immediately after purchase. But, this has both benefits and disadvantages. You Don't Have To Remember The Due Date: By paying off the credit card bill immediately after making the purchase, you do not have to remember the credit card due date.

By paying your debt shortly after it's charged, you can help prevent your credit utilization rate from rising above the preferred 30% mark and improve your chances of increasing your credit scores. Paying early can also help you avoid late fees and additional interest charges on any balance you would otherwise carry.

Most people are just fine as long as they pay by the due date. But if you're looking to bolster your credit or reduce your interest costs, consider paying earlier.

Paying off your monthly statement balances in full each month is the path to avoiding credit card debt. As long as you pay off your statement balance in full, your grace period kicks in and you can make purchases on your credit card without paying interest until the next statement due date.

The catch is these cycles can begin and end any time of the month, which is why your due date could ultimately be the 1st, 13th or 29th, depending on your card. Your credit card due date will occur after your billing cycle ends, and the time between your statement closing date and your due date is your grace period.