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How to Avoid Credit Card Late Fees

January 7, 2017

As we recently reported on the Truebill blog, American Express is about to raise late fees for customers who are late in making their credit card payments. Other credit card companies are likely to follow suit with an upward trend on credit card late fees, and so learning how to avoid credit card late fees is more important ever.

Fortunately, there are several good tools available to help you avoid those credit card late fees and keep more of your money. Here are some of the best tools and tips to avoid late fees on credit cards:

Set Up Automatic Payments if You Don’t Pay Off Your Card in Full Monthly

If you are carrying a balance on your credit card, and do not pay it off in full every month, you can use your bank’s online Bill Pay feature to set up automatic payments to at least cover the minimum payment on your credit card each month. This way, you can be sure to avoid late fees, even if you’re carrying a balance and paying interest. One note of caution – most credit cards’ due dates fluctuate slightly from month to month. So if you plan to send automatic payments each month, make sure that these payments do not arrive too early into the month – you will want to be sure that the next month’s payment does not arrive until after the next month’s statement closing date, but in time for the payment due date. That way, each month’s payment arrives “on time” and is credited for the proper due date, without unintentionally incurring more late fees.

Mint’s New Bill Management Product

If you sign up for online money management tool Mint, you can use their feature to set up reminders for bill pay due dates, including your credit card payments. Mint monitors your bills, bank accounts and credit card due dates to help you avoid late fees by keeping track of your payment due dates – it can even send alerts and reminders to you via email or mobile phone to let you know when a payment is due, and lets you schedule payments or send payments immediately.

Pay Your Bills From One App

Prism is a great money management app that lets you manage your bills, account balances, and more. It connects with all of your financial accounts and gives you an easy month-at-a-glance overview of your income and expenses, so you know exactly how much money is coming in and going out, letting you pay bills with confidence. Prism lets you schedule payments in advance or same-day, with no delays. If you are paying off multiple credit card balances, Prism can be a great tool to use because it shows you the full picture of which bills are due on various days of the month and in which amounts. This can help you avoid late fees, since sometimes people are more likely to make late payments when they are juggling multiple payments each month.

Ditch the Checks

Many credit card customers still send a check in the mail each month, but sometimes checks do get lost in the mail or don’t arrive in time. You can often avoid late fees by paying more promptly via online bill pay – especially if you set up your bank account directly with your credit card company’s website. Or you can use your bank’s online bill pay feature to pay your credit card – but beware of the number of days that it takes for the payment to arrive; some banks might need 3-5 business days – or more – before the payment actually arrives and gets credited to your credit card account. Another option – if you know that you are at risk of being late for your payment deadline – is to pay by phone or even in person at a local bank branch of your credit card issuer’s bank (if applicable).

You Can Ask the Late Credit Card Fee Be Waived

Sometimes credit card companies will issue a one-time forgiveness of a late fee, as a customer courtesy. If you happen to be late, feel free to call your bank and explain the situation, and ask if they can waive the fee. Banks typically want to keep their customers happy, so they will often forgive a fee on a one-time basis, or even once or twice per year. You should definitely try to call and ask for fees to be waived if you feel like the fee was issued in error – if you paid your bill on time, but the payment was not processed correctly, or if there was some mistake made on the credit card issuer’s end. Mistakes do happen, and it’s worth talking on the phone with the credit card company to make sure your money is going where it’s supposed to go.

Don’t Completely Fall for the “No Late Fees” Credit Card to Avoid Credit Card Late Fees

If you’re tired of paying late fees, you can sometimes avoid them altogether by signing up for a credit card that does not charge late fees. However, although it’s nice to avoid late fees, these cards will still not necessarily save you much money; they will still be charging you interest on your late payments, and making late payments can still hurt your credit score, especially if you are more than 30 days late. It’s better to avoid paying late in the first place.

Credit card late fees are no fun, but with a bit of careful planning – and using some great (free!) tools and technologies – it’s more possible than ever for credit card customers to stay on top of their monthly payments. Avoiding late payments helps you save money on late fees, boost your credit score, pay off debt faster, and keep more money in your pocket.