Credit cards and debit cards offer incredible convenience; but, is it a smart idea to pay monthly bills with them? Choosing to pay a bill with a card can have a significant impact on your general financial wellness — for better or for worse. It’s important to consider the many variables of this decision before going ahead with it. Let’s take a closer look at the pros and cons.
The advantages of paying bills with a credit card or debit card
The disadvantages of paying bills with credit or debit cards
There may be fees for paying the bill with a debit or credit card. For consumers who are already carrying high debt, it can make a difficult financial situation worse.
Similarly, it isn’t responsible to set up an automatic monthly payment through a debit card that is linked to an account that may not have enough money to cover the charge. Credit utilization may cross the threshold to an undesirable rate. Interest may accrue for consumers who cannot pay their entire credit card bill each month.
Which bills can I pay with a credit or debit card?
You will likely not be able to pay the following monthly bills with a credit or debit card:
These monthly bills can usually be paid with a credit card, but you may need to pay a fee to do so:
The following monthly bills usually allow you to pay with a credit card or debit card without a fee:
Before deciding whether to pay a specific bill with a credit or debit card, it’s best to check with your provider to find out if this is a viable option and if there will be a fee attached for paying with plastic.
The bottom line
Sometimes, paying bills with a credit card or debit card makes perfect sense, but it sometimes does not. Before deciding which way to go, consider all relevant factors detailed above to be sure you’re making the responsible choice.