Comments on: Reader Question: Timing of Credit Card Payments http://www.consumerismcommentary.com/reader-question-timing-of-credit-card-payments/ A premier personal finance blog, established 2003. Within, Flexo discusses his own experiences with money, and he and other authors comment on a wide range of personal finance topics. Tue, 29 May 2012 02:26:10 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Terry http://www.consumerismcommentary.com/reader-question-timing-of-credit-card-payments/comment-page-1/#comment-116620 Terry Sat, 30 Jun 2007 15:46:30 +0000 http://www.consumerismcommentary.com/2007/06/29/reader-question-timing-of-credit-card-payments/#comment-116620 For people who pay their balance in full - Chase allows you to set up "automatic payments" where they will do an ACH transfer from your bank account on the day that the bill is due. I'm sure some other banks do something similar. This allows you to maximize the time that the money sits in your high yield account and you earn interest on the float. You can calculate this as 1.5 months for your due balance, since your spending is probably 50% in the first part of the month, and 50% in the second part of the month, and then you have 1 month to pay the balance due. I earn about $100 - $150 (via a tax free MM Brokerage account that ACH transfers come from) a year by doing this. For people who pay their balance in full –

Chase allows you to set up “automatic payments” where they will do an ACH transfer from your bank account on the day that the bill is due. I’m sure some other banks do something similar.

This allows you to maximize the time that the money sits in your high yield account and you earn interest on the float. You can calculate this as 1.5 months for your due balance, since your spending is probably 50% in the first part of the month, and 50% in the second part of the month, and then you have 1 month to pay the balance due.

I earn about $100 – $150 (via a tax free MM Brokerage account that ACH transfers come from) a year by doing this.

]]> By: Chris http://www.consumerismcommentary.com/reader-question-timing-of-credit-card-payments/comment-page-1/#comment-116599 Chris Fri, 29 Jun 2007 18:10:15 +0000 http://www.consumerismcommentary.com/2007/06/29/reader-question-timing-of-credit-card-payments/#comment-116599 Sending money as soon as you can to lower your average daily balance is a good idea, but check your credit card terms! Some cards only allow you to make a certain number of payments per billing cycle, so any payment afterwards will be applied to the next statement. One of my cards has this restriction, only 4 payments a month. I add money to a savings account every time I use the card (I use it exclusively for groceries and gas for cash back rewards) and pay it in full when the bill comes. Sending money as soon as you can to lower your average daily balance is a good idea, but check your credit card terms! Some cards only allow you to make a certain number of payments per billing cycle, so any payment afterwards will be applied to the next statement.

One of my cards has this restriction, only 4 payments a month. I add money to a savings account every time I use the card (I use it exclusively for groceries and gas for cash back rewards) and pay it in full when the bill comes.

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