House Bills - Direct Debit (convenience) or Credit Card (reward points & interest free)

tsimop on 23/10/2016 - 22:51
Last edited 23/10/2016 - 22:52

I searched the site and I'm surprised this hasn't been discussed before.

Right now I have bills to pay for water and council rates, but this applies to any bills which give the option to pay by direct debit or credit card.

I'm trying to decide whether to pay using a credit card (to reap the reward points and interest-free period) or by direct debit (more convenient).

I'm also posting this in case any of you have a suggestion I haven't thought of.

Bill Bill Comes Value Yearly points value if paid with CC (see below) Minimum effort to pay with CC (4 times per year) Minimum effort to pay with DD (once ever, unless something changes)
SA Water 4 times a year, different amounts ~$325/quarter $8.94 SA Water website - enter account number, amount, card number, exp date, CVN Paper form, fax/post
Council Rates Once a year, broken down into 4 instalments $325/quarter $8.94 Council website, enter billing number, amount, card number, exp date, CVN Paper form, fax/post

I already pay my phone plan and credit card closing balances automatically each month by direct debit.

Using my Suncorp Clear Options Platinum Credit Card - $0 Fee for Life

  • I get 1.25 Suncorp Reward points per dollar spent
  • I can use 17,900 of these to get a Coles $100 gift card, so each point is worth $0.0056
  • So each dollar spent is worth $0.00698

So what do you think? Do you pay using CC or DD?

Poll Options

  • 27
    I'd pay using credit card and get the points - true OzB style
  • 2
    I'd set up direct debit so I don't have to think about it again
Financial

Comments

  • inherentchoice on 23/10/2016 - 23:05
    +2

    Why is direct debit more convenient? Pretty sure all the electricity retailers are happy to automatically bill your credit card.

    Although I realise that council rates and water bills may be different.

    If there's a credit card surcharge then it's usually not worth it for some rewards points.

    • tsimop on 23/10/2016 - 23:07

      Yeah, I haven't looked at the electricity one, but for these 2, automatic payment by credit card is not an option. There's no surcharge that I'm aware of.

      In this case, direct debit is convenient as I don't have to do anything except have enough money in the account. Credit card payments require me to go on the individual websites (or call them) 4 times each per year.

      • inherentchoice on 23/10/2016 - 23:11

        direct debit is convenient as I don't have to do anything except have enough money in the account

        Sometimes it's more inconvenient when you have to manually transfer money from your savings account to the transaction account.

        • tsimop on 24/10/2016 - 22:38

          In my case it'll be the offset account, so there should always be sufficient funds there.

        • inherentchoice on 25/10/2016 - 07:52

          @tsimop: But my point is that you still have to transfer it out right? Or can you direct debit the offset account?

        • tsimop on 26/10/2016 - 21:39

          @inherentchoice: My ING Orange Everyday is the offset account, so I can direct debit the offset account.

  • True Bargains on 23/10/2016 - 23:24

    I used to put them all to card for the points and to leave more money in the offset account. But if you end up paying any interest for whatever reason then any reward point benefits are too quickly more than offset. Also I tend to be more conservative with spending if it is 'real' money in a bank account and not a credit card.

  • meowmeowmeow on 24/10/2016 - 08:49

    Some cards don't give you reward points for bpay - something to keep in mind. Still get the interest free period though.

    Our electricity bill gives us a pretty decent discount for direct debit, so wouldn't make sense to use a credit card.

    • gevidian on 24/10/2016 - 14:44

      Setup direct debit using your credit card - it does make sense.

  • forumninja on 24/10/2016 - 09:17
    +4

    What's preventing you from setting up direct debit to prevent you from forgetting and pay by credit card when you remember for the points?

    • mskeggs on 24/10/2016 - 11:02

      I've never thought of this. Well done.

    • tsimop on 24/10/2016 - 22:43
      +1

      +1
      We came up with this during a discussion at lunch today (after you posted but before I read it).

      I also realised today that I don't need to wait until the last day when paying by credit card - as long as it's after the card's monthly statement date, I can pay the bill anywhere between that date and the bill due date (as opposed to bank account, where interest is calculated daily).

  • Mad Max on 24/10/2016 - 16:47

    If you have direct debit to bank account and forget to put money in before to cover the bill the bank will charge expensive overdraft fees.

  • PVA on 24/10/2016 - 22:40

    have you taken into account the CC surcharge that most companies charge - Telstra, Council charges X% extra when paying with credit card.

    • tsimop on 24/10/2016 - 23:23

      Sure have, I can't see anywhere that SA water or my council has a surcharge.

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