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Tips to Avoid Credit Card Late Fees

By: David Benton

Who doesn’t hate credit card late fees? It can be frustrating to open up your monthly statement and see an extra charge for $35, $40, even $50. In some cases these late fees can be twice as much as the interest your balance accrues in any given month! This is a fee that you could put to better use saving for retirement or for a home—or even paying extra on your credit card balance.

So how can you avoid late fees? The simple answer to that is to just pay your bill on time each month. However, since we don’t live in a perfect world this isn’t always simple for everyone.

Let’s face it, money can be tight for people some months, and if you have a large amount of debt it can be strenuous to keep your finances in order. The tips provided below are not meant to make it easy for deadbeats to take advantage of the system, but are provided to help people who on occasion encounter a rough month where maybe the car had to be taken to the mechanics, or the kids came down with the flu and there were extra medical bills and lost wages from time taking off from work to take the kids to the doctor. It happens to the best of us, but when it does, it doesn’t mean we should be faced with potentially staggering credit card late fees. So let’s look at some tips to help you when money’s tight or when you just simply forget to pay your bill.

Tip #1: Skip the payment

This doesn’t mean that you should just completely ignore the bill until the following month. If you do you can be assured you will face a hefty late fee. Credit card companies have gotten a bad reputation of being heartless and self-serving, but this actually isn’t the case. In fact, credit card companies view themselves as providing a service that helps make peoples’ lives better, which it does when used properly.

If money gets tight one month and you have no way of even paying the minimum amount owed, then call your credit card company and explain the situation. As long as you’re in good standing with them, most companies will allow you to skip the monthly payment without any penalty. However, some may charge a small fee that they add on to your balance so make sure and ask before making a decision. Credit companies will allow you to skip a payment occasionally, but don’t rely on it as a fallback all of the time.

Tip #2: Pay the minimum

Most financial experts balk at this because they understand that paying the minimum means that it will take a credit card holder years to actually pay off the balance. In most cases, you should pay the minimum amount due plus the amount of interest accrued for that month. However, if you find yourself strapped for funds one month because of some unforeseen emergency you can always just pay the minimum amount due. It won’t make much of a difference in your overall card balance, but at least you avoid a huge late fee, and maybe if your situation improves you can send some extra money the following week, or just pay extra when the bill shows up the following month.

Tip #3: Change your due date

If your credit card bill shows up in the middle of each month, but you only get paid on the first, then call your company and ask them to change your billing cycle so that the credit card bill arrives around the same time. This way you know that you will have money on hand to pay the bill each month.

Tip #4: Pay with the phone

Most people today have a debit card. If you happen to get bogged down in the demands of life and realize that on the 15th of the month your credit card payment is due, and then you realize that it is the 15th, don’t panic if you have a debit card. Call your credit card company and pay over the phone. All you have to do is give them the card’s account number and the payment is instantly made. Some credit card companies do charge a fee for paying by phone so you might want to check beforehand. If this turns out to be the case, then you may want to avoid making this a habit.

And what if you are one of the few who don’t have a debit card? You can still pay by phone. All you have to do is give your checking account number and bank’s routing number to your credit card company. However, if this can be avoided then it should. Sadly, it’s just not safe to divulge such personal information over the phone anymore.

You don’t have to resign yourself to paying late fees when you can’t pay your credit card bill sometimes. The tips above will help you avoid late fees. Remember, credit card companies are generally understanding. When money is tight and you’re having trouble making your payment, make sure and communicate with your credit card company. They will appreciate you more for doing so and it will help keep your credit score in good shape. In the end, it’s really all about communication.