There is no real rule, but here is a good guide to follow.
- The more you monitor your credit card balances, the less likely you are to overspend.
- If money is tight, a weekly check-in may be appropriate.
I remember receiving a credit card bill years ago that was much higher than expected. When I looked at my statement, I realized that in a single month I had charged my flight and accommodations for an upcoming vacation, as well as some unusual purchases, like a new laptop, that increased my balance.
Fortunately, I had a cushion in my checking account and was able to cover that bill in full. I also had money in my savings account to fall back on, though since that money is earmarked for emergencies, I’m hesitant to make withdrawals unless it’s for something really urgent or unexpected.
But that huge credit card bill taught me an important lesson: check my credit card balances often. These days, I make it a point to check my balances once a week. And you may want too.
An easy way to avoid going overboard
The danger of accumulating too high a credit card balance is not being able to pay the bill in full. Once you transfer a balance, you immediately accumulate interest that makes your purchases cost more.
What’s more, if you build up too much of a balance, you can get to the point where you don’t even make your minimum payment. That could have serious consequences, like sending your credit score into a tailspin. Even if you can make your minimum payments, simply using too much of your available credit could also hurt your score.
That’s why I now make it a point to review my credit card spending on a weekly basis. If I see my balance growing faster than expected (for example, I see a recurring charge that I forgot), trigger a warning to reduce spending until my billing cycle is over. If you regularly find yourself in a situation where you’re looking at a credit card balance that you can’t pay off in full, you may want to get in the habit of reviewing your accounts every week.
In fact, if money is extremely tight, you might want to consider checking your credit card balances every few days, or even every day. If you’re nearing the maximum limit on your credit cards, then a daily check-in is definitely reasonable until you’ve managed to bring down some of your balances.
If you hardly ever get close to your credit limit, you can always pay your monthly credit card bills in full, and you have a decent cushion in your checking or savings account for a higher-than-expected tab, then you might. that you don’t have to check your credit card balances until your bills are due. Or, you can commit and do a mid-cycle check.
It’s also about peace of mind
For me, checking my credit card spending every week helps make sure I’m not forgetting about charges or racking up too many too quickly. And that peace of mind is worth the few minutes it takes me to check my balances.
If you think you could benefit from a weekly credit card check-in, schedule one on your calendar until you get into the habit. You may find that it improves your finances.
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