There are several tips to never make a late payment. If you're unorganized, busy or a poor money manager, you might occasionally forget about a due date. This might not seem like a big deal – at least not until the late payments start to roll in.
But aside from paying extra fees, missing a payment can eventually harm your credit score. Most creditors report delinquencies once a bill is 30 days past due. But there are ways to make sure your creditors receive timely payments. Here are seven easy tips to never make a late payment again.
1. Don't Buy Things You Can't Afford
One of the best tips to never make a late payment – don't buy things you can't afford. If you're window shopping, you may be tempted to use a credit card on impulse buys. And if you're constantly purchasing things you can't afford, your credit card balance may increase, to the point where it becomes difficult to make minimum payments.
2. Keep Track of Due Dates
Then again, maybe you have money for bills, but you always forget to pay them. Getting organized can solve this problem. You'll need to track due dates. Use a calendar on your smart phone to set up payment reminders, or set up email alerts with your creditors. This way, you're reminded of due dates in-advance.
3. Set up Online Account Management
Sometimes, payments arrive late because of slow postal mail service. If you insist on writing checks to pay your bills, mail checks at least one week before the due date. Another option is signing up for online account management. You can make payments online on or before your due date. Also, if you make a payment before a certain cut-off time on your due date, the creditor will offer same-day credit.
4. Automatic Bill Pay
Another option is automating your bills. With this option, you decide when to pay bills and how much, and the amounts are automatically drafted from your bank account on specified dates. This is a practical option if you're busy and constantly forget due dates. Just make sure there's enough money in your bank account to cover the draft.
5. Set up Email Statements
Creditors aren't perfect and sometimes they forget to mail bills, or statements might get lost in the mail. As a result, you might forget about a bill and overlook a due date. Even if you receive paper statements, sign up for e-statements. Your creditors will deliver monthly statements to your email.
6. Pay Statements as Soon as They Arrive
To avoid forgetting a due date, pay monthly statements as soon as they arrive. It's easy to ignore a statement and say we'll deal with it later. But if you have a lot on your plate, you might forget about the statement as soon as it's out of sight.
7. Make Sure You Receive a Confirmation
Not only should you make payments online, make sure you receive a confirmation. When you sign up for online account management, the creditor will ask for an email address where they'll send payment confirmations. If you make a payment, but don't receive a confirmation, contact your creditor to confirm receipt of your payment.
Late payments can trigger late fees, higher interest rates and possibly a damaged credit score. And neither is good when you're planning to buy a house, or if you're trying to improve your score. What are other ways to avoid making late payments?