A majority of people will repay their credit cards in full each month. However, there are some people that do not and some which sometimes do and sometimes do not. It is a good idea to have a careful think about whether you should be paying them off in full or not. There are advantages and disadvantages to doing both and you should have a think about them so that you can decide whether it is something that you feel that you should do.
Advantages of Repaying Credit Card in Full
When you have outstanding credit card debt you will be charged interest on it. Once you have had your monthly statement and you have chosen not to repay the full amount that you owe, you will be charged interest on the remaining balance. This means that you will be paying a fee for not repaying the card in full. Credit card interest tends to be relatively high compared to some other types of borrowing and so you need to be sure that you are wise to be borrowing this money and that there is not a better way to get it. It is good to find out exactly how much you will be charged and consider whether you think that this is worthwhile.
If you do not repay all of your credit card then you will have less money available to spend on it the next month because you will have a credit limit and only be able to spend a certain amount of money up to that limit. The more you spend and have outstanding on the card, the less of the credit limit you will have left and this will mean that you could struggle to manage if you are looking to buy something expensive and you do not have the money. Therefore, if you repay it all, you will have access to more money.
Disadvantages of Repaying Credit Card in Full
If you repay the credit card in full each month it means that you will not have to money of your own available for other things. It could leave you short of money for paying all of your bills and other necessities. Although you will be able to buy some things on your card such as in shops, you may not be able to make bill payments and if you need cash it can be expensive to withdraw on a credit card as you start getting charged interest right away when you use one to make a cash withdrawal.
So, you can see that there are different sides to be thought about when it comes to deciding whether you should think about repaying your credit card in full. If you feel that you want to save the money and not pay interest then it is best to repay it each month in full. You can set that up to happen automatically and then you will not even have to remember to do it. However, you will need to think about whether this is something that you will be able to afford. It can be wise to make sure that you keep a check on your balance and spending so that you only spend an amount that you can afford to repay. This means that you will not risk getting into trouble when the bill is repaid in full. It also means that you will then have your full credit limit available to spend the following month and if you need something extra expensive then you will have the means available to buy it, which can be very reassuring and help you to feel secure too.