Paying off card balance in advance...

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DM_NYC
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Paying off card balance in advance...

Postby DM_NYC » Fri Jan 03, 2014 12:55 pm

Looking for collective wisdom here:

How far in advance do you pay your card balance off?

Does it matter (read help your score) how early you pay, as long as it's not late?

Any other advice I might need to know?

Thanks in advance folks!


DavidNY
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Postby DavidNY » Fri Jan 03, 2014 1:19 pm

I use autopay.

DM_NYC
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Postby DM_NYC » Fri Jan 03, 2014 1:26 pm

DavidNY wrote:I use autopay.


Ok. How far in advance though?

mathman314
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Postby mathman314 » Fri Jan 03, 2014 2:33 pm

I usually let the balance report (if it's not too large) and then pay it off.
One of my cards reports sometime between the 13th and the 20th and then I pay it off between the 21st and the end of the month. Payment is due the seventh of every month. So about two weeks in advance.
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DM_NYC
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Postby DM_NYC » Fri Jan 03, 2014 3:32 pm

mathman314 wrote:I usually let the balance report (if it's not too large) and then pay it off.
One of my cards reports sometime between the 13th and the 20th and then I pay it off between the 21st and the end of the month. Payment is due the seventh of every month. So about two weeks in advance.


Hmm ok.

My payment is due the 12th of each month. The current cycle ends on the 14th and the new one begins on the 15th. (Not sure what the buffer period in between is about)

When you say "balance reports" you mean when the company let's you know that your balance is due?

mathman314
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Postby mathman314 » Fri Jan 03, 2014 4:14 pm

balance reports = what the card issuer reports to the credit bereaus.
Issuers usually report pretty soon after each statement is calculated.
Cards:
1FBUSA: 5.75k
Discover IT (for students): 4.6k
Chase Freedom (signature): 5k
Target REDcard: 1.5k
AmEx BlueCash Everyday: 5.5k

FICOs:
TU - 785 (December 2015)

DM_NYC
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Postby DM_NYC » Fri Jan 03, 2014 7:18 pm

mathman314 wrote:balance reports = what the card issuer reports to the credit bereaus.
Issuers usually report pretty soon after each statement is calculated.


Thanks for the clarity.

JoDa
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Postby JoDa » Sat Jan 04, 2014 1:22 am

It depends on what you're trying to do. If you want to maximize your credit scores, paying off before it reports will probably be helpful. I make sure all my cards show a zero balance on my credit report before big financed purchases like property. If you're just trying to avoid interest, then as long as you pay all purchases off within the grace period, you'll be fine. I tend to take a "pay as I go" approach when not going for a major financed purchase. I charge my groceries, cell phone bill, a dinner, or whatever, and pay them off within the week, but because I'm making regular charges on my cards, it never usually hits zero, officially, as far as my credit report goes. Doing a monthly automatic pay-off would have the same effect.

One other thing you have to consider is whether you have the discipline to not over-spend and dig yourself into debt. If you think you might over-spend, you could make a rule to pay off charges immediately and not charge once you have no more spending cash. I did that for about a year to "right" myself on how much I really had to spend, while still getting the rewards, when I first got a real job. I still do it when I go on vacation and might be tempted to "treat myself." I save up for the vacation, put the money in my checking account, and pay off my purchases as I go, so that it's always visible just how much I have left to spend...no matter how tempting that 5 star dinner might sound...
CSP $19K
BOA $4K
UMP $11.5K
Target Visa $1.5K

daniel2304
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Postby daniel2304 » Sat Jan 04, 2014 11:02 am

Joda's advice is useful, however, I disagree on keeping a zero balance will benefit in building credit score. You always want to have a very small balance compared to your credit limit at all times. Most issuers like to see the stability and ability in debt management from a borrower. So having zero balance is not really showing how you manage your money in their view.
All my posts are my opinions. All my posts mentioned "you" are merely for discussion-purpose only. No advice is given in any post at any time. It is also impossible for me to put effort to verify every statement that anyone has given.

takeshi
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Postby takeshi » Sat Jan 04, 2014 9:47 pm

DM_NYC wrote:How far in advance do you pay your card balance off?

I don't. I pay on the due date unless I'm trying to manage reported utilization.

DM_NYC wrote:My payment is due the 12th of each month. The current cycle ends on the 14th and the new one begins on the 15th. (Not sure what the buffer period in between is about)

The time between statement close and the payment due date? Try Googling on "grace period".

daniel2304 wrote:Joda's advice is useful, however, I disagree on keeping a zero balance will benefit in building credit score.

IIRC utililzation above 0% is scored higher than utilization at 0%.



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