How to Save Money Switching From Monthly to Weekly Payments
You can pay off your debt quicker if you choose to make weekly rather than monthly payments. Whether it is your credit card or your car payment, dividing the minimum monthly due and paying it a little earlier will work in your favor. Here's how to save money by switching from monthly to weekly payments.
- Difficulty:
- Moderate
Instructions
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1
Determine how your interested is accrued. If your interest is accrued daily, then paying any amount before the due date will not only reduce part of the principal, but also knock down the interest due.
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2
Calculate how frequently you are willing to pay your credit card. This will be dependant upon how frequently you get paid. If you are paid weekly, it will be easier to set up weekly payments, whereas a bi-weekly paycheck will facilitate bi-weekly payments.
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3
Make sure your weekly payments total the minimal monthly payment due. If your minimum monthly payment due is $225 and you pay $50 a week for four weeks, you will be $25 short. Your credit card company or auto loan company will charge a late payment fee if they do not receive the full minimum monthly amount on time. A late payment fee will wipe out interest savings you may have earned.
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4
Be disciplined. It will take discipline and planning to ensure that the payments are made either weekly or bi-weekly. Once you've gotten used to paying your bills weekly, it will become easier.
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1
Tips & Warnings
If your bank offers electronic bill payments, you can schedule your payments in advance. Just be sure to have the money in your bank account on the payment due date.
The weekly payments outlined above apply to non-mortgage debt. Mortgage companies may charge a fee to change your monthly mortgage to bi-weekly. You will have to contact them first before altering your payments.
