Using Your Credit Card to Pay Bills

It can be great to pay your bills using your credit card, if done properly. You can earn rewards, better manage finances, and improve your credit. However, this tactic only works under certain circumstances. There is a responsible way to handle this method. If you are only using your credit card because you don’t have enough money in your other bank accounts, then that is a problem.

Before you even consider doing this method, you want to make sure that your credit card balance is at $0. The reason you want to keep the balance at $0 is because you will end up paying more if not. If you keep a balance on your credit card from your bills, then you may end up paying more because of interest. That is why how you handle your bills with a credit card can either be beneficial or hurt you.

Benefits of Having One Card for Bills

This is a great strategy if you need more financial organization. You want to find a credit card that has great opportunities to earn rewards, all while having a relatively high card limit. The reason you want a high card limit is because when you do pay your bills, you don’t want your utilization to be extremely high. If your bills are $800 a month and your credit line is $1000, then you would have a high utilization temporarily. A good rule of thumb is to keep utilization no more than 30%. This means if your bills were $800 then a $2700 credit limit would be best for you. You also want to make sure the credit card you are looking at has good reward programs. The reason that you want to have rewards, is so that you will be able to benefit by just paying your bills!

Making Sure Your Checking Account is Handled Responsibly

If you start utilizing your credit card for your bills, you may feel tempted to spend from your checking account. You need to make sure that you are strict with your budgeting. You also need to be sure that there is always enough money in your checking account to pay off your bill in full every month. It is important that you will be able to avoid more debt and any interest that comes from using your credit card.

Check Your Convenience Fee

Every credit card has their own set of rules. You want to check with your credit card company to see if you will be charged a convenience fee when you use your credit card to pay bills. If you have a convenience fee, then it may be best to not use your credit card when making these payments.


Using your credit card for your bills may be able to be beneficial depending on the credit card, the company you use, and your budgeting strategy. If you take the time to organize your finances, you may find that using a credit card is a better option for your bills!