Rule No.1 of owning a credit card: Pay off your full balance every month. But that can be easier said than done. Some people stick to debit cards, which don’t let you spend more than is in your account, solely because they make it impossible to mire yourself in debt. But it would be a mistake to refuse the very real benefits of having a credit card because you’re worried about inadvertently spending money you haven’t yet earned.
For anyone who’s really worried about keeping their credit card spending in check, there are services like Debitize, a website that will use money from your checking account to pay off your credit card bill throughout the month. So if you spend $100 on your credit card, that $100 disappears from your checking account balance immediately.
Many budgeting apps will show you both your checking account and your credit card balance, allowing you to see if the latter has ballooned to twice what you’ve got socked away—but seeing the problem isn’t the same as tackling it. It’s easy to fool yourself into thinking, “Well, I’ll have enough money when I get paid in a week” or subject yourself to some creative budget math.
When activated, Debitize can automatically siphon off money to cover your credit card purchases, or you can choose to do it manually. You can also set it so that it only transfers money if your checking account has more than a certain minimum balance. That way, you don’t have to worry about accidentally overdrafting in your quest for good credit.
By default, Debitize holds onto the funds it takes from your checking account until your credit card bill comes due at the end of the month. But if you want, you can also use Debitize to optimize your credit score by paying off your bill whenever your balance threatens to exceed the recommended “credit utilization ratio” of less than 30 percent of your credit limit.
Either way, the company does keep your funds in sort of a credit-limbo situation; though according to the site’s FAQs, the funds are held with a regulated bank. Using the service, you can pay off credit card bills from big-name banks like Chase, Wells Fargo, Bank of America, and Citibank. Unfortunately, some credit card providers (like Discover, for example) aren’t supported, so while you can see that account’s balance on Debitize, you can’t set up automatic payments through the service.
Another downside to the service is that there isn’t a mobile app. The site is easy to use on a phone’s web browser, but it doesn’t have quite the convenience of a standalone app. According to a company representative, the first iPhone app is due out sometime in early 2017, with an Android version to follow.
Regardless, the convenience of never having to wonder if you’ve paid your credit card bill or if you have enough in your checking account to cover your automatic payments is well worth it.
November 22, 2016 – 1:00pm