Some bills (like your rent) can’t usually be shuffled around, but luckily, your credit card due date generally can be. Here’s how to change it — and why you might want to.
Changing your card’s due date is simple
Changing a due date is generally an easy favor for banks to grant.
“If the date isn’t working for you, call and in most cases they’ll accommodate you,” says Beverly Harzog, credit expert and author of The Debt Escape Plan.
Some issuers allow you to change your payment date online – and some offer the option of choosing a due date up front when you’re approved for the card. If yours doesn’t offer either option, just call the number on the back of your card and ask.
There may be some limitations, though, including how often you’re allowed to change the due date. Bank of America allows due-date changes twice within a 12-month period, says spokeswoman Betty Riess. The change also won’t go into effect immediately – American Express (a CreditCardForum advertising partner) won’t apply the new date until the following billing cycle, says spokeswoman Elizabeth Crosta. Bank of America may take up to two cycles, Riess says. So make sure you ask your issuer about the timing and how it could affect interest on any pre-existing balances.
One more important rule: Your account generally must be in good standing (in other words, not delinquent) before your issuer will allow you to switch your due date.
Why change your due date?
The date your issuer assigns you may be inconvenient for you if:
- It doesn’t go with your cash flow: If you don’t have a bunch of extra money lying around, you cash flow governs when you can pay bills. Having your mortgage payment, car payment and card bill due at the beginning of the month could be a problem – but bumping your card’s due date to later in the month can give you breathing room, especially if you schedule it a few days after the month’s second paycheck usually hits your account.
“Think of all the money you have to spend during the month and what time of the month you have to spend it,” Harzog says. “If your situation changes, you can change the date again. People don’t realize how much autonomy they have when it comes to these things.”
- You’re trying to manage your credit utilization: How much of your available credit you’re using has a significant effect on your credit score. The concept at play here is called “credit utilization,” and you generally want yours to stay under 30 percent – that is, you’re using up no more than 30 percent of your credit limit for each card and across all your cards. Credit utilization shouldn’t be cause for obsession if you’re just using your cards as payment tools. If you’re trying to build an excellent score before applying for a major loan, though, your credit utilization becomes a big deal.
Yet, even if you pay off your cards in full every month, high utilization may get reported to the credit bureaus. Why? Every bank has a “reporting date” – the date it sends data about your accounts to the bureaus. If this date occurs before you pay off your card, that $3,000 purchase on a card with a $3,500 limit could still register.
So, call your bank, ask when it reports to the bureaus and adjust your due date accordingly, Harzog recommends. For example, if your card reports on the 25th of the month, consider moving your payment date to the 15th.
“That’s just a little strategy to keep your score as high as you can,” Harzog says.
Of course, you could also solve the problem by making multiple smaller payments over the month. But if you know you’ll forget to do so, adjusting your due date and setting up auto pay can act as a safety net. However, Harzog warns, banks may change their reporting dates and generally don’t inform consumers. So double check your bank’s reporting date several months before you apply for an important loan.
- You’re trying to get organized: If you do have enough cash in the bank to pay all your monthly bills at once, clustering your due dates can eliminate the mental noise of having all your bills scattered throughout the month.
“Condensing as many things as you can into one day can be a great idea,” Harzog says.
Don’t try to manipulate your payment date for the wrong reasons
Consumers struggling with debt might see the ability to change your payment date as an escape route. After all, changing your due date from the 1st of the month to the 15th might seem like a good way to buy yourself two extra weeks in whatever payment cycle the change goes into effect.
“Never underestimate how creative the consumer can be,” Harzog says. “Some people would see that as a hack.”
Manipulating your payment date for this reason can backfire, however. For one thing, you’re avoiding the issues behind your debt problems. For another, you don’t know exactly when the change will go into effect, meaning you’ll need to carefully track your due dates and grace periods while things are in flux. Miss a step, and you’ll be hit with more interest charges or even late fees. In other words, all that juggling means changing your due date isn’t an easy fix to cash-flow problems.
“I covered this exact topic in my latest book, and it was one of the hardest sections to write” Harzog says. “There are so many factors involved.”