Paying Credit Cards by Standing Order

Noobie2011

Hi All,

I am currently trying to sort out my bills so that I am in control of when everything goes out. This is fine for most bills but with Credit Cards it seems their DD schemes just has a bill period where they can take the payment at anytime and doing the minimum amount also can change slightly.

So what I want to do is setup a Stading Order that will pay a specific amount every month. Now I dont use these Credit Cards anymore so would be looking at setting up a Standing Order to start at the current minimum payment and then keep it at that amount every month.

Have other people done this and is this a good way to manage it as the DD scheme just seems too confusing.

Thanks in advance

Dobbibill

You can set up a SO for your Credit Card but as you say, Credit Cards have billing periods so without checking your statement on a monthly basis, you would not know if you were paying it on time, as this can change slightly each month. Also a minimum payment will change month to month, depending on the interest charged but you cannot set up a SO to take a varying amount. (unless you amend monthly, which defeats the purpose)

Have you considered using separate accounts for your bills and your 'day to day' money?
If you set up a Direct Debit on the bills account - all you are responsible for is making sure you leave enough in this account to cover all bills for the month. The credit card company are then responsible to collect the correct amount on the correct day.

HTH

alderpoint

Noobie2011 wrote: »

it seems their DD schemes just has a bill period where they can take the payment at anytime and doing the minimum amount also can change slightly.

In practice the DD would probably go out a few days before the due date each month - if you tell them to take the minimum then yes it will change (reduce slightly) each month but you'll end up paying a lot of interest by the time it's all paid off.

So what I want to do is setup a Stading Order that will pay a specific amount every month. Now I dont use these Credit Cards anymore so would be looking at setting up a Standing Order to start at the current minimum payment and then keep it at that amount every month.

No reason why you can't do that. Try paying a little more than the minimum as that will reduce the debt slightly quicker - also pay as soon as you can each month to get the interest amount lower.

Gizmo247

Quite a few credit cards allow you to also specify a fixed amount as a Direct Debit payment which will default back to the minimum amount if that is greater. I would recommend you contact your credit provider to see what payment option exist and what their rules are making adhoc payments at the same time.

As the bear minimum, I would recommend setting up the minimum payment via Direct Debit and then also make an overpayment via Standing Order unusually more that 5 working days before the payment date.