Paying more than the minimum is essentially a continuation of tackling just one card first. Once you’ve chosen to focus on paying off just one credit card, you can start by paying more than the minimum on that card every month.
The proof is in the payoff:
- You’ll save money on interest.
- You’ll pay your balance off sooner.
- You’ll improve your credit score.
Even if you’re paying a few dollars more on your credit card payments (although the more dollars, the better), creditors are more likely to view you as a positive credit risk…
Source: The Street
Here are two easy ways to manage paying more than your minimum balance:
1. Pay the minimum twice.
Make your first minimum payment BEFORE it’s due. Then pay it again a week or two after. Make sure the second payment is applied before the end of your payment cycle.
2. Pay the minimum, then pay some more.
If you can’t afford to pay the minimum twice each month, try paying just a little bit extra for your second payment. Even an extra $10-$20 will help and it won’t make as large a dent in your bank account as making two minimum payments per month.
The more extra payments you make on your focus card, the lower your interest charges will become. Lower interest charges will make paying the card off easier and quicker, which will in turn lower your utilization rate. Eventually you’ll be able to manage paying more than the minimum on multiple cards at once!
Sadly, this wasn’t an option for me. The interest charges and minimum payments on my focus card (the AMEX) were so high that I couldn’t afford to put any extra dollars on my payments without being able to pay my bills on time, and I hate late fees almost as much as I hate credit card debt.
If you have the extra money, this is a great option for you. You’ll reduce the amount of time required to pay off your debts in no time and you’ll look a lot better in the eyes of the credit bureaus.