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Bottom Line Up Front

  • Paying bills with a credit card can be a good way to earn rewards.
  • Some bills can’t be paid with a credit card, while others charge a fee.
  • Keep credit utilization in mind.

Like many people, you may have always paid your bills with a debit card, direct debit or check. But have you wondered if a credit card could be a better way to pay? Read on to learn if paying bills with a credit card is right for you.

Pros and cons of paying bills with a credit card
Pros Cons
Consolidated—have all your expenses on one statement Increased utilization—experts suggest keeping your credit utilization below 30% to protect your credit score
Rewarding—earn cash back or rewards points if you have a rewards credit card Additional interest—you may be charged interest on your credit card if you don’t pay the balance in full
Convenient—no need to mail in a check Potential fees—you may be charged a fee for using a credit card to pay certain bills
Credit-building—paying bills can help contribute to your credit history Not always an option—some bills, such as rent, may not be payable with a credit card

What Bills Can You Pay With a Credit Card?

Bills that typically allow credit card payments include:

  • insurance (car or home)
  • subscription services
  • utilities (electric, gas, water or trash removal)
  • internet, cell phone and cable
  • taxes

In general, loans, mortgages and rent aren't payable with a credit card. If credit card payments are allowed, you may be charged fees that could cancel out any potential benefits.

How Should You Pay If You Can’t Use a Credit Card?

When you can’t pay your bills using a credit card, you have several options with their own perks and downsides.

  • Direct debit: Also known as automatic debit, you may qualify for a lower interest rate with this payment method. Simply provide the merchant or service provider with your checking account information, and they’ll withdraw the necessary funds on the monthly due date.
  • Online bill pay: By giving your financial institution details on a lender or service provider, you can set up an automated bill pay schedule. It’s a great way to put all your bill pay information in one place, but it can take some time to set up.
  • Checks: They may not be automated, but because you need to write a check each time you make a payment, you can easily double-check that you have enough money in your account first.

Stay on Top of Your Credit Card

If you decide to pay bills using your credit card, then it’s more important than ever to keep up with payments. Pay as much as you can on time each month to help minimize interest payments and avoid fees. Learn more tips on managing credit card payments.

This article is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.