Paying off credit card balance before due date - Card Insurance Premiums

theoracle30 on 15/03/2014 - 11:28

Hi there, I have the new Citibank Signature card (thanks to OzBargain!).

I'm considering their additional CardGuard insurance because it gives me ability to claim price different of at least $10, over 6 months (as opposed to their complimentary insurance which has a minimum of $75 difference, and only covers 2 months).

However, the premium is $0.59 per $100, and considering my average spend of $5000, that's around $30 a month which would negate any potential savings.

On the PDS, they say this is charged based on the closing statement amount each month. However, let's say my monthly cycle is on the 11th. If I paid off most of the current months' expenses on the 7th, leaving a near-0 balance around the 11th, would my premium be based off this new lower amount, or still based on my total spend that month?

Thanks for any help!
BL

Financial

Comments

  • PissLUR on 15/03/2014 - 11:58
    +1

    Yes, You would pay $0 premium if there is a $0 balance on your card.

  • Shadowsfury on 15/03/2014 - 14:41

    Don't forget to account for the "lost interest" for paying the card off early. You're still going to be ahead, but not by 0.59%

  • Steptoe on 15/03/2014 - 16:25

    Works the same for 28 Degrees Card. Savings interest rates are that high that you need to jag the payment on the 11th hour.

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