How to avoid late payment fees

Sometimes it can be hard to stay on top of all of your payment deadlines. But if you forget to make a payment, you will be charged a late payment fee, which could cause you even more trouble. So how exactly can you avoid this?

What is a late payment fee?

If you’ve ever looked at your credit card statement, you’ll notice a minimum amount payable every month. If you don’t make this minimum payment on your balance, your bank will issue you a late payment fee. This is a fee that you will have to pay on top of your balance if you don’t make your minimum payment. This fee won’t just be charged for one month, you will have a late payment fee added to your balance every month you don’t pay your minimum

Obviously, late payment fees make a bad situation even worse and increase the size of your repayment obligations. That’s why, if you have trouble paying your credit card balance, you should at least pay your minimum payment so that you don’t have a late payment fee.

Tips to avoid late payment fees

Schedule automatic payments

Most likely, your bank allows you to schedule your credit card payments in advance. This is a great way to avoid late payment fees, since you don’t have to think about when to pay this debt each month and will have the money automatically taken out of your account to pay your minimum balance.

Don’t spend more than you can afford

By keeping your spending at a reasonable amount, you can make sure that you always have enough money to pay your minimum balance and avoid any late payment fees. One way to help with this is by budgeting your spending each month.

Set alerts

Instead of scheduling automatic payments for your account, you can set alerts to remind you to make your payments on time. There are a few different ways to do this: you could make a note in your personal calendar or set a recurring monthly reminder on your phone. Some banks will even send alerts to you as a reminder to make your payments. These can all be helpful ways to keep you from missing a payment. But always remember to keep buffer day(s) between your payment transfer instruction date and the actual payment due date – just in case the payment instruction date falls on a public holiday, your payment will only be made on the next business day, which again could result in a late fee charge! So, it’s advisable to schedule the actual payment at least 1 or 2 days before the actual payment due date, depending upon whether there are public holidays during that month.

It could get worse

It’s not only that late payment fees cost you money, but there are also other bad outcomes that will affect your financial health. If you don’t make payments on time, your credit card interest rate may go up, costing you more money in the future. Also, late payments may show up on your credit report, and could cause your credit score to drop, making it harder for you to get credit.

Late payment fees represent penalties you should never have in your life. Not only do they cost you money, they don’t give you anything in return. So, always do your best to at least pay your credit card minimum balance so that you don’t get in a situation you’ll regret.

Financial Wellbeing: The information provided herein is for educational and informational purposes only and is not intended for trading purposes or to be passed on or disclosed to any other person and/or to any jurisdiction that would render the distribution illegal. You may not offer any part of the information provided herein for sale or distribute it over any medium including but not limited to a computer network without the prior written consent of ENBD.

The information provided herein does not constitute investment advice and is not a distribution, an offer to sell, opinion, recommendation or the solicitation of an offer to buy any financial instrument or security. An investment if any, mentioned herein may not be suitable for all investors and if you are unclear about any of the information provided herein, please consult your accountant, banker, broker, lawyer, tax adviser or other professional adviser. You must make your own independent decisions regarding any security or financial instrument.

The appropriateness of an investment activity or strategy will depend on the person’s individual financial circumstances, objectives and needs. Before entering into any transaction, the risks should be fully understood and a determination made as to whether a transaction is appropriate given the person’s investment objectives, financial and operational resources, experiences and other relevant circumstances.

Information has been obtained from sources believed to be reliable but no warranty is made as to the accuracy, completeness, reliability, suitability or usefulness of any information contained herein and no liability in respect of any errors or omissions (including any third party liability) is accepted by ENBD.

Past performance is not a guide to future results or returns and investors should be aware that the value of any investments and the income derived from them may fall as well as rise and they may not get back the full amount invested. Exchange rates may also cause the value of underlying overseas investments to go up or down.

Anything to the contrary herein set forth notwithstanding, ENBD, its affiliates, agents, assigns, directors, employees, officers, representatives, successors shall not, directly or indirectly, be liable, in any way for any: (a) inaccuracies or errors in or omissions from the information provided herein including, but not limited to, quotes or financial data; (b) loss, injury or damage arising from the use the information provided or downloaded herein, including, but not limited to any investment decision occasioned thereby; (c) consequential, direct, exemplary, incidental, indirect, punitive or special damages even if ENBD has been advised specifically of the possibility of such damages, arising from the use of information provided herein, including but not limited to, loss of revenue, opportunity, or anticipated profits or lost business

ENBD reserves the right to amend these Terms at any time without notice. These Terms shall be governed in all respects by the laws of the UAE. Emirates NBD Bank P.J.S.C. is regulated by the Central Bank of the UAE and by the Securities and Commodities Authority of the UAE.

Learn about Borrowing