What I was going to do was pay it down to zero by using the utility money, but I can see now that the logic is backwards, especially since I wouldn’t be starting with zero. Got it 🙂 I may be a little slow to grasp but I do eventually get it!
If you start with $0 on the credit card, spend $300 on it, and pay off when you get the bill, you don’t pay interest on that $300.* If you had $400 balance on the card, spend $300 on it, then pay $300 on the balance at the end of the month, you’ve paid extra interest on whatever the ‘average daily balance’ that the $300 works out to… Those people who pay off the card every month may not be paying interest, but there’s still too many disadvantages in my opinion.
*Some card do what they call ‘2-cycle billing’. Meaning they determine your average daily balance for TWO months instead of one.
So even though you paid off the card at the end of month 1, they still charge you a bit of interest mean your second month’s bill won’t be zero. It’s another one of the tricks that CC companies use to nickel and dime you to death.
I tell people this. The cc company’s SOLE purpose in life is to separate us from our hard-earned money. They’re VERY good at it, and have a big enough government lobby that they can get away with all SORTS of devious tricks. Run away, and never look back.