How to Manage your Credit Card Repayments Effectively
4 Min Read | Published: 19 March 2025
Written by American Express
A Credit Card can be a great way to manage your monthly outgoings, build up your credit score and provide funds for important purchases. Some Credit Cards even have perks like payment protection, reward points or cashback.
It’s important to only borrow what you can afford to pay back. This article covers how to pay off a Credit Card, budgeting tips and more so you can make the most of your Card.
Minimum Credit Card repayment
The minimum repayment is the smallest amount you can repay on your Credit Card. It’s usually between 1 and 5% of your balance, or sometimes it’s a set low amount.
If you have an expensive month and can’t afford to pay off your full balance, this is a useful option. However, it’s not a good long-term plan, as the interest will build up and you’ll end up paying more over time.
Importance of monitoring your statement
You need to keep an eye on your statement so you can see how much interest is building up if you haven’t been able to pay the balance in full every month.
If you’re worried about how much you’re spending, this is also a good way to see exactly where the money is going and whether you can cut back on anything.
If you can afford to, a good strategy is to set up a direct debit to pay off your balance each month. This means it’s all taken care of and there’s no risk of forgetting to pay. If this isn’t an option for you, there are other ways you can pay off your Credit Card.
Tricks to paying off Credit Cards
Here are a couple of good tips to help repay your Credit Card:
Look at your spending
If you’re finding it difficult to pay off the full balance each month, see if there’s any way you can spend less. Check your statement and see how much money you pay on taxis, or eating out, for example. Are there cheaper options available?
Use the debt snowball method
Focus on paying off debts from the smallest to the largest. This gives you quick wins and helps keep you motivated.
Setting a realistic budget
Set some time aside to go through your bank and Credit Card statements. See how much you’re spending each month and what exactly you’re buying. You can then put together a budget of how much to spend on food, living expenses, bills and so on.
If possible, include a set amount in your budget to pay towards your Credit Card balance. This should be more than your minimum payment. You can set this up as a standing order, so you know it’s going to the right place automatically.
Prioritising high-interest debts
When you’re going through your finances, have a look at how much interest you’re paying for your Credit Cards or other loans. Make sure you prioritise paying off those with the highest interest first.
You could even think about consolidating some of these if it’s an option, so you only have one monthly payment and not several with different interest rates.
Building a positive credit history
We talk a lot about your credit history, but what does it mean and why is it so important? First, your credit history is how lenders work out whether they’ll lend you money. If you apply for a mortgage or want to buy a car on hired purchase, you’ll need a good credit score to qualify.
To build your credit score, you’ll need to use credit. This is one reason a Credit Card is a useful financial tool – having one and using it responsibly will build your credit score. You’ll also need to be on the electoral roll, so find out from your local council how to do this. It’s also important to make sure you have a bank account and manage your household bills well.
Avoiding late fees and penalties
Missed or late payments could cost you a fee and damage your credit rating. This is why it’s essential to always pay at least the minimum balance each month.
Amex payment features for easy management
There are many convenient ways to pay your Amex bill online. American Express® Cardholders can use The Amex® App which has alerts and reminders for due dates and to keep an eye on your balance.
You can also use your bank’s internet banking service to transfer the money or set up a direct debit.
American Express Cardmembers can also use Plan It™ to set up an instalment plan of three, six or 12 months. The fixed monthly fee is shown up front, so you know exactly what you’ll need to pay.
What happens if you don’t pay Credit Card debt?
If you’re unable to pay your minimum payment, you will incur late fees, and it may affect your credit score. If you’re an Amex Cardmember and you’re struggling, speak to our American Express Financial Hardship team who can help you find a solution.
If you’re an Amex Cardmember and you’re struggling, speak to our American Express Financial Hardship team who can help you find a solution.
How long does it take to pay off Credit Cards?
How long it takes to pay depends on how much you pay off each month. The more you pay, the less interest you’ll accrue and the faster you’ll be able to pay off the balance.
Find the Amex® Card that fits your lifestyle and see what other benefits await year-round.