Small Efforts. Big Results:

This tip helps you save on interest when you have credit card debt. Credit card interest is typically compounded daily, which means that interest is calculated on your outstanding balance each day. By splitting your monthly payment into two smaller payments, you reduce the average daily balance, which in turn lowers the amount of interest that accumulates.

Here’s how it works:

1. Let’s say your monthly credit card payment is due on the 15th of each month, and you usually make one payment for the full amount at that time.
2. Instead, you can make a payment, let’s say, around the 1st of the month and another around the 15th. When you make the first payment early, your average daily balance for the month is lower because it reflects the reduced debt earlier in the billing cycle.
3. When you make the second payment on the 15th, your balance is already lower due to the first payment, resulting in less interest being charged.

By doing this, you’re essentially chipping away at your credit card debt a bit faster and minimizing the interest that accumulates. It’s a simple yet effective way to save money on interest charges and pay off your credit card debt more efficiently.