NEW YORK ( LowCards.com) -- Holiday shopping is just around the corner, and consumers need to have their credit card balances as low as possible to avoid costly interest charges. One way to do this is to make micropayments on their credit card bill. While we are conditioned to pay our credit card bill once a month, consumers can actually make a number of smaller payments throughout the month. Some banks and issuers allow payments to be made as often as once a day.If you carry a balance, micropayments can reduce the interest because most credit card companies charge interest based on your average daily balance during the month. Pay more often and you reduce your average daily balance and therefore the interest you pay that month.
- You may have better control of your payments. If you are paid weekly or bi-weekly, money can slip away by the end of the month. Designate a specific day after you are paid to send in a payment for your credit card. Four $50 payments or two $100 payments are sometimes easier to make than a monthly $200 payment. It is also easier to add a little extra money to smaller payments.
- The higher your interest rate, the more you will save.
- In time, micropayments can help raise your credit score. An organized, scheduled payment plan can help you avoid late payments and pay more than the minimum due. These are important elements for a good credit score.
- Micropayments can reduce financial stress. Making payments right after payday when you actually have the money will likely reduce anxiety and financial stress.