Liza Lee

Quick Guide: Should I Pay By Cash or Credit Card?

Merchants usually provide payment options to pay for their goods and services. Only if it is a simple eeny, meeny, miny and mo… but, it isn’t for anyone with a mortgage.

Let’s say on 11 April, I had my car serviced and the technician reported that the four wheels are running thin and suggested that they need to be replaced. For safety reasons, the replacement went ahead. At the end of the service, he asked if I would like to pay the cost of $1500 by credit card or eftpos/bank transfer. So, I determined the best option as it depended on variable factors.

The end of my credit card cycle usually falls on 15^th of the month for payment due on the 8^th of the following month.

Option 1 – Payment via EPTPOS/Bank Transfer

Payment amount to be deducted from a mortgage account	$ 1,500.00
Mortgage interest rate	6.67%
Interest per annum (365 days)	$ 100.05
Interest per day	$ 0.27
11 April to 8 May = 27 days	$ 7.40

Payment to merchant using bank transfer	$ 1,507.40
Option 2 – Payment via Credit Card
Using credit card	$ 1,500.00
Credit card surcharge rate	1.50%
Credit card surcharge amount	$ 22.50

Payment to merchant using credit card	$ 1,522.50

Bank transfer vs Credit Card	$ 15.10

From the above, I would be paying $15.10 more for the service had I chosen to pay via Credit Card.

This expense is out of the ordinary and would require dipping into savings. Building your savings can be achieved through proper financial planning that ties in with your budget including a forecast across all financial scope. Please refer to ‘Bring Me Wealth Please’ <https://www.austinmacauley.com/book/bring-me-wealth-please> for detailed knowledge and step-by-step instructions.

Disclaimer:

Thank you for your interest. Please keep in mind that both books ‘Bring Me Wealth Please’ and ‘Bring Me Success Please’ including their contents and blogs are copyrighted material. Please read the policy below:

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This guide is of a general nature. It has been prepared without taking into account your particular investment objectives, circumstances, financial situation or needs. Before acting on the information, you should consider your own investment objectives, circumstances, financial situation and needs. This guide is not intended to be, and should not be construed in any way as, investment, legal or financial advice.

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