How to Make Your Payments Count

Make every credit card payment count...positively!

Catch Up on Past-Due Accounts. If you're behind on your bills, bring them current. While a late payment can remain on your credit report for up to 7 years, having all your accounts current can be good for your scores. Additionally, it stops further late payments from being added to your credit history as well as additional late fees.  

Pay Down Revolving Account Balances. Even if you're not behind on your bills, having a high balance on revolving credit accounts can lead to a high credit utilization rate and hurt your scores. Revolving accounts include credit cards and lines of credit i.e., Conn’s, Best Buy, other department stores, etc. Maintaining a low balance on them relative to their credit limits can help you improve your scores. Those with the highest credit scores tend to keep their credit utilization ratio in the low single digits.
Split your payment in half and pay twice. Credit card interest isn’t calculated based on how much you owe on the due date or at the end of a billing period. Instead, if you carry a balance from one month to the next, your interest is based on your average daily balance. Because of this, making smaller payments more frequently can reduce the amount of interest you owe.
Automate your payments. For any method you use, automating your payments allows you to commit to a monthly budget for reducing your credit card debt. Take advantage of any ability to rearrange your credit card payment dates to better align with your paychecks.

Don’t close unused credit cards. By closing an old or unused card, you are essentially wiping away some of your available credit and thereby increasing your credit utilization ratio. If you are tempted to close a card to keep from swiping it thus overextending yourself financially, the next tip is especially important for you.