Please feel free to send in the lessons you have learned on your journey.
- Making a payment is not the same thing as establishing a payment plan. So I was told by my hospital after I learned that my medical bills were being sold to a collection agency. After I'd been broke, after I'd been bankrupt, and when I had the money to pay the bills. I was sending in $100 per month for my bills, and thought I was okay. I learned that every line on my bill was considered a separate account, basically, to the hospital, so while they were applying payments to a $300 charge, the 15 smaller charges that occurred the same day (every individual blood test), were considered inactive, no payment, and sold to a collection agency. Had I requested a "payment plan" for my account, it would have prevented the charges from being sold.
- Early payments don't mean you met your minimum. This one is a lesson learned by my mom's co-worker. She's making payments, regularly, to her credit card, although she does have a balance from month to month. In fact, a few months ago she made multiple payments in one month, each well above her minimum. The last payment she made was on the 6th of the month. The last day of her billing cycle was the 7th. As it happened, she didn't make a payment for another 30 days. She was shocked to discover the late charge that appeared on her account when the next cycle closed ~ because she had not made a payment within that cycle. If you're strictly budgeting and you're paying down balances, you want to send your money off as quickly as possible, to save every day of interest. Say her 6th of the month payment was $50. Had she paid $35 on the 6th and $15 on the 7th, she wouldn't have been hit with a late charge. (Luckily, given her recent account history, the fee was waived.)
