Is Skip a Payment a Bad Idea?

I received my December credit card monthly statement and the minimum monthly amount due displayed zero. I read further down the statement and noticed there was a note that offered me the option of skipping my December monthly payment. This is a trick. Don’t fall for it. You have to ask yourself, why are they offering me this? Is it because I am a good customer. No! It is because they want to make more money.

The Skip a Payment option is usually offered by mortgage or credit card companies at the end of each year. It can be difficult to resist this temptation. The offer usually comes during the holiday season when most families are struggling to make end meet or need extra money to buy holiday gifts.

Here’s the trick. If you didn't charge anything else on your credit card for the rest of the month, you would still owe more money due to the accrued interest added in at the end of the month on what you already owed. Some companies charge a fee for using the skip a payment option which is added to the total balance.

Using a skip a payment option, your January statement you require you to pay two months’ worth of interest plus whatever items you purchase in January. Skipping a payment reinforces bad spending habits. It seems easy and convenient but costs you more in the long run. The longer it takes to pay off a credit card bill, the more interest and finance charges accrue and the more debt you owe. The only one benefiting is the credit card company. If you are offered a "skip a payment" option here are some things to consider:

1. Avoid using it more than once
2. Don't use it if your credit card balance is 50% or above the credit limit
3. Avoid using it as a solution to a financial problem
4. Only use it if you cannot afford to make the minimum monthly payment and will end up missing a payment
5. Don’t use it if your credit card is maxed out or you are close to maxing out your credit card because the missed payment may put your over the limit and cause you to be charged an over-the-limit fee or late fee
6. Don’t use it as an excuse to buy something
7. It does not lower your credit score
8. You must be in good standing with the company

I am sending in my payment for my December statement. Stop making credit card companies rich. Remember, if something sounds too good to be true, it usually is.