Avoid late payments by setting up auto bill pay

Late payments happen, so take steps to avoid it becoming a regular thing

To Her Credit columnist Sally Herigstad
Sally Herigstad is a certified public accountant and the author of "Help! I Can't Pay My Bills: Surviving a Financial Crisis" (St. Martin's Press, 2006). She writes "To Her Credit," a weekly reader Q&A column about issues involving women, credit and debt, for CreditCards.com, and also wrote for MSN Money, Interest.com and Bankrate.com, and has guested on Martha Stewart Radio and other programs.

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Dear To Her Credit,
With the hustle and bustle of Thanksgiving, I made my Visa payment two days late. I always pay my bills at work when I get paid. Well, we were off this Friday for the holidays and it completely slipped my mind.

I paid the bill today (November 30) as it was due on Friday. Will this affect my credit badly? I plan to call them and ask them to waive the $25 late fee because this is my first time paying late since getting the card in August 2013.   -- Karen


Dear Karen,
Don't worry, missing a credit card payment by a couple of days is not likely to affect your credit score. The bank probably won't even report it to the credit bureaus.

Most banks only report an account as delinquent when it is at least 30 days late. Some only bother after 60 days. Although I can't guarantee your bank won't report an overdue payment within the first 30 days, it's highly unlikely. In fact, can you imagine the data overload if banks reported to the credit bureaus every time someone was two days late.

You're smart to call and ask for a waiver of the $25 late fee. I always request a waiver -- not that it happens that often -- and I've never been turned down. When you're a good customer, the bank representative would rather keep you happy and using the card than charge you the $25.

I completely understand missing a payment by a few days during the hustle and bustle of holidays -- or during life in general. To avoid the stress of wondering if I'm late on any credit card bills, I've set up automatic payments on all my credit card accounts.

These automatic payments are very small, just enough to cover the minimum payment most months. I prefer small automatic payments, because they don't affect my bank balance much. I pay the rest of the balance before the due date. If I go on vacation or for some other reason I'm a few days late on the second payment, I may have to pay a small interest charge. That's galling enough because I hate paying interest. But at least I never have to worry about late charges, let alone negative marks on my credit report.

Another way to avoid late payments is to pay your bill earlier in the month. If you can afford to pay your bill as soon as it comes, so much the better. The best way to use a credit card is to only spend money that you already have in your checking account - not as a way to spend next month's salary today. That way, once a purchase is on the card, in your mind the money is gone. When you pay the bill, you're just transferring money from your checking account to your credit card account. By paying your credit card bill sooner, you not only avoid having to worry about late payments, but you actually part with the money while you still remember the restaurant meal or new shoes that you enjoyed buying.

You're doing a great job paying your credit card bill on time so far. Don't feel bad about the barely late payment. Keep up the good work, and take care of your credit.

See related: Putting card payments on automatic can backfire

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Updated: 02-18-2019