While credit cards can be great tools to make your life easier, they also come with some pretty hefty interest rates and charges that add up over time. To keep your costs low, you’ll want to avoid raising more debt than you can pay off each month. The best way to do this is by setting a minimum payment on your credit card each month, which will help keep your interest rate down and allow you to pay off the bill faster so you can start saving money on interest fees. Here are some easy steps to set your minimum payment on your credit card so you can save money over time.
5 Easy Steps to Setting a Minimum Payment on Your Credit Card
1. Choose the card you want to set your minimum payment for.
2. Enter the card number and expiration date (MM/YY).
3. Click set minimum payment, then confirm by clicking continue.
4. Once you have completed all steps in setting up your new minimum payment, click save.
5. Under minimum payments, you will see how much of each statement period will be allocated to paying off interest charges and how much goes towards paying down principal balances.
It’s important to understand how much you owe when paying minimum credit card balances. This means looking at your credit card statement and taking note of the current balance. If you have multiple balances across different cards, it may be difficult to tell which one has the lowest balance. In that case, call your bank or log in to their website to find out.
Apply for a Balance Transfer
A balance transfer allows you to consolidate your debt onto one card with a lower interest rate. This can help you save money on interest and pay off your debt faster.
Track Your Spending
Before you can set a minimum payment, you need to know how much you’re spending each month. The best way to do this is by tracking your spending for at least two months.
Learn How to Budget
You need to understand and create a budget before you can set a minimum payment on your credit card. A budget will help you monitor your spending and make informed decisions about where your money is going. Plus, it’s just good financial planning.
Establish an Emergency Fund
Before you start making minimum payments on your credit card, it’s important to have an emergency fund in place. This will help you cover unexpected expenses without putting them on your credit card.
Look at Cashing in Rewards Points
One way to make paying your credit card bill easier is to cash in rewards points. As experts at SoFi point out, “If you have a rewards credit card, you can use your points to pay for travel, gift cards, merchandise, or cash back.”
The minimum payment on your credit card is the least amount you are required to pay each month to keep your account in good standing. If this isn’t enough, you may consider transferring your balance to a low-interest card or consolidating debt with a personal loan.