Soften the Stress Involved when Missing Credit Card Payment Due Dates
Edited by Christine dela Cruz, Lynn, Doug Collins
It certainly happens from time to time. Cash flow and finances simply do not balance at some point, and you end up being unable to settle your bills on time. There is no need to feel that you are doing something terrible because of these rare instances, although, of course, it is important to be responsible for your debts, there is no need to crucify yourself for missing a payment or two during crisis time.
However, missing payment due dates, such as in the case of credit cards, does not often pass without corresponding worries. There are certain repercussions you have to anticipate, and along with these, comes a certain level of stress.
Payment Obligations According to Priority
In case crisis time happens and you have insufficient funds to cover all of your bills, it is wise to understand which ones to prioritize to make ends meet. Although all you owe money to equally have the right to demand payment when it is due, it would be wise to weigh which ones would cause you more trouble, in case you delay your payment. Knowing this will help you:
- 1Home loan.This should be your topmost priority when making monthly payments. Not only do home loans charge hefty interest charges for late payments, but you must remember as well that continuous non-payment can easily lead to them pulling out the home title from you.Advertisement
- 2Car loan.This works the same way as home loan. Most of the time, they allot very little margin for non-payment. If you reach your second or third month of inability to pay, they can easily take away the car from you.Advertisement
- 3Personal loan.Because personal loans are one of the most risky types of loans that banks could release, because it is obviously used for personal reasons, they impose stricter policies to handle missed payments. They tend to be more aggressive to non-payers, with not only phone calls to your home or mobile number, but also possibly to your workplace and other areas where they can reach you. They also tend to impose higher penalties and interest.
- 4Credit card usage.Although non-payment of credit card bills will also have a significant effect on your credit score, it is so far one of the most flexible in terms of payment. As long as you communicate with your bank about your difficulties, they will be able to recommend other options for you in order for you to manage your payments.
How to Reduce Stressors that Go with Missed Credit Card Payments
- 1Maintain regular communication with your bank.Do not just get lost. You will receive more calls or reminders if you just turn off your phone and let your bank wonder where you are. Do not act like you're running away from your bills. Face the problem as an adult.Advertisement
- 2If you knew earlier than the due date that you might not have sufficient funds to complete the payment, inform your bank about this ahead of time.Do not wait until the due date has lapsed. Honesty is very important. It would not hurt to let your bank know you are having difficulties. In fact, they can even help you address it further through different payment options.
- 3Show your bank that you have a payment plan in place.It is good to let them know you are having difficulties, but do not just leave it at that. Your bank would like to know how you plan to address the issue. They might also ask you for a certain commitment date when you think you'll be able to make the next payment. When doing this, make sure you are realistic in setting targets.
How to Plan Accordingly in Order Not to Miss Payments
- 1Do not spend more than your anticipated income.It is very easy to overspend when you do not plan your cash flow accordingly. There should be a good balance between your expenditures and what you actually earn.Advertisement
- 2Do a forecast of your payments schedules and divide that into weeks.If you do not want to be burdened by huge payments that are due at the end of every month, why not divide them into weeks? It will create a psychological effect and it will appear to be more controllable in terms of balancing it out with your income and other expenditures. Stick to your forecast and make sure that you are able to save up for that amount literally every week to come up with the monthly figure that you need.
- 3Cut down on unnecessary expenses.Look through your usual expenses and see if any of those are still relevant. For example, you may still be paying for your home landline but no one actually stays home most of the time and if you do, you would rather use the mobile phone anyway. Cutting down those types of expenses and combining what you save out of those can easily make up for the payments that you have to make.
- 4Enroll auto-payments.If you would like to be disciplined in terms of ensuring that your credit card bills are prioritized every month, enroll your account to an auto-payment system that links to your bank account. This will make sure that it automatically debits from your income and you will just have to work on whatever is left in your account for your other expenses.
- 5Limit missed payments to just one month at the most.Keep in mind that when you keep missing on your credit card payments, that will increase the interest rate by a huge amount. Therefore, in the long run, you become more and more in debt with those late charges. If you have to miss a payment, do not go over one month and try your best to catch up on the following month so your rates will come back to normal. Late payments just add up more problem for you if you are not able to take care of it immediately.Advertisement
- If you have problems with any of these steps, ask a question for more help, or post in the comments section below.
Categories : Financial
Recent edits by: Lynn, Christine dela Cruz