I’m very new to this and I feel super embarrassed getting bombarded with information by my bank. I was told I did good and bad. Any input?
Again
Balance owed: $20
Current account balance: $404.75
Payment made: $400
So you did good by not just paying the Minimum Payment. What’s unclear is how much your Statement Balance was, which is different than your Current Balance or they could be the same if you haven’t made any new charges since your statement closed.
So what’s your latest Statement Balance?
If it was $400 or less then you did ‘good’ by paying your cc bill so you won’t be charged any interest. Anything extra you paid above the Statement Balance though was I’d say ‘neutral’. Not necessary to pay anything more than that, just like it’s not necessary to pay more than it says on your utility bill each month, but also isn’t a ‘bad’ thing. In future you can just pay the Statement Balance each month (pay your cc bill).
@Wynne
My statement balance was like $386.
Graydon said:
@Wynne
My statement balance was like $386.
Then you should have paid $386 on the due date.
Graydon said:
@Wynne
My statement balance was like $386.
Then you should have paid $386 on the due date.
It’s completely fine to pay more than the statement balance if your current balance is higher. It’s also completely fine to pay before the due date, just not after.
Graydon said:
@Wynne
My statement balance was like $386.
Then you should have paid $386 on the due date.
You can pay it all. It doesn’t make that much of a difference if he pays over the statement balance.
Graydon said:
@Wynne
My statement balance was like $386.
Then $400 was fine…
Graydon said:
@Wynne
My statement balance was like $386.
The rest of the balance will be on your next statement and your statement will list what dates it covers. So depending on your finances you can get up to a month to delay paying back something, but always make a minimum payment and ideally pay off the entire statement by the due date. Or earlier but by due date gives you the longest amount to have the money for.
If it’s a new card it may have a 0% intro offer for X months, usually 12. Which means you can pay minimum and put off paying the rest without interest. But they hope to get you in a jam and unable to pay it all later on so this is a bad idea for most people. (But great if you shuffle money around, keep track of dates well, and want to use the money for other stuff like investing).
Nothing’s good or bad. If you just have a card because it makes it easy to budget each month that’s fine. There’s nothing wrong with what you did. If you had an introductory low APR, some people would suggest you carry the balance, but they’re designed to be used and paid off each month. Don’t be concerned.
@Elinaah
Not paying full balance is VERY bad.
Thorne said:
@Elinaah
Not paying full balance is VERY bad.
Not making any payments is very bad. Minimum is no problem as long as it’s 0% APR. It could be looked at as bad as in it could create bad habits of not paying in full every month but that’s about it. You could use a 0% APR card for big purchases and pay it off over time, there’s nothing wrong with that.
Thorne said:
@Elinaah
Not paying full balance is VERY bad.
Not if you have a 0% APR offer.
Thorne said:
@Elinaah
Not paying full balance is VERY bad.
Not if you have a 0% APR offer.
Agreed. Now show me where OP said they have a 0% APR.
@Thorne
The comment you replied to was saying something to the effect of ‘if you have a promotional intro APR deal, it might make sense to not pay it off’, which you seemed to take issue with…
MysteryMaverick said:
@Thorne
The comment you replied to was saying something to the effect of ‘if you have a promotional intro APR deal, it might make sense to not pay it off’, which you seemed to take issue with…
The comment I replied to started with NOTHING is good or bad. That’s what I’m referring to.
OP what do you mean by $1,000 on the card right now? Is that your limit?
Make sure you at least pay the statement balance. You don’t necessarily have to pay the full (current) balance. That way you will avoid interest. Pay the other $4.75 before your next statement closing date. Otherwise, interest will start to accrue on the remaining balance. And once interest starts to accrue, it’s kind of a pain in the ass to get your grace period back.
The best way to manage a credit card is to set up automatic payments for the statement balance and not spend more than you have. I like to set up my payments a few days before the due date in case something goes wrong.
You missed out on $1.50 of free money from a 4% APY HYSA. So, could be worse. But overall, as long as you’re paying off the statement or the account balance monthly and not paying interest, that’s all that matters. How much you want to squeeze out of your money is up to you.
If you don’t get rewards from your credit card, it’s bad.
Now you have to pay interest on the $4.75, that’s bad. Lol.