Sunday, February 02, 2014

Benefits of Paying on Time


The recession, government shutdown, and other economic events caused many Americans to become unemployed and forced others to reduce their spending quickly or pay their bills late.  Being unemployed has a domino effect, many Americans lost their homes, their health insurance coverage, cars, stability, spouses, their pride and more. 

Loss of a job or income causes Americans to make late payments, overdraw on their accounts and search for unconventional ways to make ends meet. For those Americans who had not made late payments, you may be rewarded. 

I have one credit card with my credit union and have been a member for over 10 years.  I recently lost my credit card and while reporting my lost credit card I was asked if I wanted a credit limit increase.  This was done without a credit check my limit was increased $1,000.  I have not made a late payment in over 10 years that may be a rare thing in this economy. I was happy to be rewarded for being a good customer and my credit limit is still under $10,000. 

Many people waste money by paying late fees because they forgot to pay a bill. Late fees add up quickly. If you have trouble remembering to pay your bills on time schedule your payments using online banking or automatic paycheck deduction.  There are many benefits to paying your bills on time.  Here are 8 benefits of paying your bills on time.

  1. Fees.  If you pay your credit card balances in full each month you don't have to pay finance charges or late fees which save you money.
  2. Reduce debt. If you pay your credit card bills on time
  3. Credit score.  If you pay your credit card bills on time this helps to increase your credit score over time.
  4. Bank relationship. Paying your loan or credit card bill(s) on time helps to maintain a good relationship with your credit card company and they are more willing to work with you if you have a financial crisis in the future.
  5. Perks.  Paying your loan or credit card bills on time will afford you rewards such as: credit limit increases, a decrease in interest rates, discounts, incentives, promotions, and other offers.
  6. Options. Paying your credit card bill on-time allows you to choose from various payment options: online, automatic deduction, by mail, or over the phone.  When making late payments you have to send your payment overnight or pay over the phone which will cost you more money.
  7. Reduces stress.  Paying your credit card bills on time prevents creditors calling you asking for a payment and reduces the stress or worrying about how you will make your payments.
  8. Future.  Paying your credit card bills on time makes you look more favorable if you wish to buy a home in the future.

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