You probably know that to keep up with a good credit standing and have a high credit score, you need to make your credit card payments on time. It’s even more important if you’re just starting out into the world of credit cards so you can build a strong credit history. You never know when you may need that superior credit record to help you secure lower interest rates on big purchases down the road.
And while you indeed know paying your balance (preferably in full) every month and on time is critical, you may wonder, “Can I make multiple payments a month on my credit card?”
The answer to this question is yes. And more importantly, it’s something that you absolutely should do if you have the opportunity to do so.
Most people don’t realize this trick can help them out in many ways. That’s why I want to share with you more details on why you should be making multiple payments a month to your credit card company. It can benefit you in many ways, though there’s much more to know than just this so keep reading!
Why you should be making multiple card payments every month
Some of you may wonder why you’d make more than one payment to your credit card company per month. Isn’t one enough? Surely, making your monthly payment and making it on time is a good thing. But why stop at that? Here are the benefits of making these multiple payments every month.
– You’ll avoid late payments
There is nothing worse than getting a late payment on your account. You’ll start incurring late fees and will basically be spending your hard-earned money on that. Plus, they will report your late payment to the credit bureaus and that will lower your credit score.
While you should avoid overpaying on your credit card (please read my detailed post about that), if you have only half the amount of your payment with your first paycheck and
– No more interest charges
By paying down the debt on your credit card, you will stop accumulating finance charges. Even with a low APR, those finance charges add up. If you could avoid paying an extra $300 a year on interest charges, wouldn’t you do it? Imagine what you could be doing with that $300 instead.
When you make multiple payments on your credit card each month, you won’t have a finance charge at the end of the month. Since you won’t be carrying a balance, you’ll be saving on those interest charges, which by the way, are calculated by the day. That means they can really add up. My example of $300 a year was a lowball number just to keep the math simple. Much more likely, you’re paying way more than that in interest charges and you can completely avoid doing so by making multiple payments to your credit card company each month.
The best way to do it is to make your biggest payment as early as you can in the month. With the money you save from not paying interest, you add that back into your bank account. Which means your bank balance grows while your debt shrinks. It’s always a good thing!
And speaking of debt…
– It will help you pay down your debt faster
It really might help to think about this like you would with a mortgage. If you use the same principles, you’d apply to paying down your mortgage faster, you can do that with your credit card debt as well.
Every mortgage comes in the form of a monthly payment. If you take that payment and cut it in half, then you pay it every two weeks. That creates 26 halved payments, which translates to 13 monthly payments. Since there are 12 months in a year, you’re making an extra payment that can shave 7 years off your 30-year mortgage. That’s exactly the same kind of thinking you can and should be applying to your credit card debt.
Obviously, the sooner you pay that debt down, the less you are paying in those pesky monthly finance charges. You stand to save a lot of money. A LOT! And that’s a good thing. You can use your money for other things rather than flushing it down the drain in the form of finance charges.
– It’s a good way to take advantage of windfalls (like tax refunds)
Once you get into this credit-healthy habit and start paying twice monthly to pay down your debt, you will instantly think of using any windfalls that come your way to make these payments. Perhaps it’s a holiday bonus from the boss, an increase in pay, or everyone’s favorite… your tax refund.
Why would you do this? Well, if you’re hoping to apply for a loan or you need your credit score to be high for some other reason, every point you have in that score counts. So when you keep your credit card balance low all month, it’s one of the smartest ways to handle credit matters.
Don’t forget that you should keep what you owe to 30% or less of the maximum credit line to keep your credit score looking good.
– It’s Easy to Make Multiple Credit Card Payments
The best part about making multiple credit card payments per month to pay down your debt is that it’s such an easy way to quickly get credit in good standing. While most credit card companies only permit one auto-pay per month, you can add a manual payment anytime you want.
Just be cautious of when you make that payment. If you have auto-pay set up, you don’t want the system getting confused and then winding up with a negative balance on your card. Something like that could trigger a fraud alert, particularly if the number is a large one.
Some card companies won’t limit how many payments you make a month. In fact, they’ll be happy to have you pay them the money you owe. However, you might be limited by how many you can make within a 24-hour period. If you’re not sure, call up and speak to customer service to find out the best way to do this without creating a negative balance or any confusion for anyone.
You can also use your bank if they offer the service of setting up an auto-pay. This way, you can set a separate bill pay via your online banking account and you’ll always have a designated amount coming out of it to go right to your credit card, until you correct your debt situation.
What you should keep in mind before making multiple payments
While it almost always will benefit you to make multiple payments a month on your credit card to pay down credit card debt, there are some things you should know first before you do it. There could be extra fees or limitations. Keep reading to find out about these!
– Make sure there are no fees for extra payments
Not all credit card companies operate in the same way. You’d think they’d all be thrilled to be getting paid, that’s not always the case. After all, they do make quite a bit more money when you’re racking up those interest charges.
Before you try out the multiple payments per month technique, you should see if the online bill-pay service doesn’t charge you extra for making those extra payments. It should be listed on your credit card company’s website, but if you don’t find anything listed, it doesn’t hurt to call and ask to be sure. When there are extra fees involved for making multiple payments per month, it pretty much offsets the benefits it could have.
Not all cards will charge a fee for doing this but there are some that will. It’s always best to err on the side of caution and be certain before you do more harm than good.
– Maximum number of payments per month
On the other hand, there are some credit card companies that set a limit for how many times a month they will accept a payment. Look on your credit card company’s site and see if you find anything listed about this. It would not work out in your favor if you try the multiple payments per month only to be stuck for not making the last payment because your credit card company won’t allow it.
Some do this because it costs money to process those payments. Generally, most will accept one payment per week, but more frequently than that could cause problems. Even less frequently might cause problems. Cards like Capital One state that three pending payments at once is the limit, but every card is different. Again, if you don’t see it on the website, give a call and find out from a representative to know for sure.
There’s a handy table that can help you out with this so take a look below!
| CREDIT CARD ISSUER | MULTIPLE PAYMENTS | LIMITATIONS AND CONDITIONS |
| American Express | Allowed | One online payment every 24 hours. |
| Bank of America | Allowed | No limitations. No fees on web payments regardless of how many you make per month. |
| Capital One | Allowed | 1 payment per day, per credit card account. Note: At any given time, Capital One customers can only have 1 pending payment (i.e. one payment which has not been processed yet.) |
| Citi | Allowed | |
| Discover | Allowed | Payments every 3 days. |
| HSBC Bank | Allowed | No limitations! Note: Customers can’t make 2 payments of the same amount on the same day in order to avoid duplications; Moreover, you can’t preschedule your payments more than 1 year in advance. |
| JP Morgan Chase | Allowed | You can’t make 2 payments within 3 days from eachother. |
| US Bancorp | Allowed | No limitations. No fees on web payments regardless of how many you make per month. |
| USAA | Allowed | No limitations! |
| Wells Fargo | Allowed | No limitations. No fees on web payments regardless of how many you make per month (However, limits might be imposed if the transfer has been made from another Wells Fargo bank account). |
How making multiple credit card payments a month can improve your credit score
I want to get into something here real quick so that you fully understand how making multiple credit card payments each month can help you. It CAN help your credit score, but there’s a little more to it than that.
See, that number of payments you make each month isn’t listed on your credit report. Scoring systems don’t look at this. So, when you make more than one payment each month for those credit cards, it’s not increasing your credit score. It’s the results of paying that debt down that is going to help you out.
And in case you’re wondering, if you do pay your credit card bill every month in full, if you were to check your credit report, you might not see a zero balance. This is nothing to panic about. It’s completely normal. The reason this happens is that the amount of your balance on your billing statement is what’s reported to the credit bureaus. You just might be seeing it when it hasn’t been updated to include that the payment was made on time.
There’s no way to control when this report is made on your credit history. It could be right before you pay your payment on time or it could be the day after. Or it could be any day in between. Your credit report will show how much you owe at any given time and whether you make your payments on time.
About 30% of your credit score is based on how you use your credit. So, if your balance is temporarily higher just because you had to buy a new refrigerator, even if you pay that balance in full and on time when the bill is due, it will lower your credit score.
That doesn’t seem very fair, but hey, that’s how it is. To get around that and other high balances, you can make multiple payments each month on your credit card as long as the things I mentioned above aren’t going to cause problems for you like early payment or a limitation on how many times you can make payments each month.
So, you could schedule your payments in the middle of the month for half the payment amount and then later in the month, pay off the remaining balance when the bill comes. Again, all of this is pending your credit card company’s policies. Remember, if there’s a fee for extra payments or it restricts how many payments you can make per month, this isn’t your best option.
As
long as there are no restrictions, you can try something else that usually
works. Let’s go back to that refrigerator. Or even better, airline tickets for
your dream vacation (Which you should definitely get for free by using your
credit card points!)
Whatever it is, you can send the payment to your credit card company as soon as
you make this purchase. This helps you keep your credit score high which is
something you want to do if you’re getting ready to apply for a loan.
I’ve had to do this before. I had the misfortune of getting a flat tire (always at the most inconvenient time). Instead of getting it patched though, I decided to replace it and the other 3 tires as well. I’m no fool with cars. One look at the flat and the other tires told me it would be unwise to patch the flat for the wear on that tire was pretty steep. The other tires weren’t so far off in wear themselves.
I made the executive decision to go ahead and replace all 4 tires while I had it in the shop. While I did negotiate a great price on those tires, it was still a pretty pricey spend for the day. After I slid my card across the counter and signed, I drove home and called up the credit card company. I explained my situation and asked if I could just make that payment to them on that day through the automated system. The representative I spoke to was very friendly and kind, and gave me the reassurance I needed that this would be fine with them and that were no rules against doing so. It all worked out for me so if something like this happens to you too, give a call and see if they’ll take that payment right away.
You may even consider doing this for other reasons, like if that purchase puts you too close to your credit limit. This is a great idea if you’ve had to buy airline tickets for a more impromptu trip and you need your credit line free for your travels. You certainly don’t want to be somewhere and go over the limit on your card and incur a fee.
Some people will go to extremes to get out of debt. They’ll send an electronic payment every day or every other day. As long as there are no limits imposed by the credit card company, I suppose you can do what you want. It could even keep you focused on paying your debt off. But I don’t recommend this. It’s not like each and every additional payment triggers a reward system from the credit bureau. There’s no confetti ball drop or champagne toast. You’ll benefit the most from splitting it into 2 payments, or even 3 per month if it’s allowed and you can swing the cost.
To recap all of this fun, here’s a quick list of the benefits of making multiple payments a month on your credit card:
- It helps you pay down your debt faster
- It lowers the balance of what you owe versus your credit line
- It can be helpful when you make a large purchase too
- It saves you from paying more in interest charges
- It can get your credit back on track by owing less
- It helps you build better habits that will result in a higher credit score
For all these reasons, it might really make sense to go ahead and start making that extra payment or two per month on your credit card to start getting out of that danger zone. Remember, you only want to be using 30% of your available credit line (ideally less than that) at any given time so use this trick to your advantage!
Conclusion
If you were surprised to learn that you could get out of debt faster by making multiple payments per month on your credit card, then this trick might be the key for you to get back on track. As long as your credit card company has no impositions and you can afford to make those extra payments, it will help serve you better.
It’s not going to suddenly change your credit score and raise it up several hundred points though. You’ll have to patiently pay down that existing debt and get it to a manageable level. With timely payments and a reduction in debt, you should see an improvement in your credit score.
While that won’t change for some time, you can enjoy the fact that you’re beating that interest rate. Interest rates for credit cards accumulate money by the day which is exactly why some of you may really benefit from paying down that balance twice monthly or more often if allowed. It works like paying off your mortgage early and you get to keep that excess cash that you’d otherwise have shelled out on those annoying finance charges.
Multiple payments per month are also a terrific idea following large purchases. Even if you have stellar credit right now, if you have to make a big purchase, that balance will show on your credit report and lower your score temporarily. You can keep it from making a dent by making multiple payments per month and sending that payment for the large purchase immediately.
Lots can happen with this trick for lowering your debt while working to improve your credit score. If you’re not sure of your credit card’s policies on this, it never hurts to call and ask them your questions. Just like anything else, the worst thing they can tell you is ‘no,’ so go check it out!