Am I paying more by topping up my credit card before making a big purchase? - Seedly
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Anonymous

Asked on 09 Jul 2019

Am I paying more by topping up my credit card before making a big purchase?

If the purchase is $2k and I only have $1k+ left in the credit limit, does it make more sense to pay $1k in cash and pay the rest in credit? Or top up the card with $1k cash and pay everything in credit? (Thereby paying more later in the statement). It doesn't make sense haha.

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Yinghua Liu
Yinghua Liu
Level 5. Genius
Updated on 10 Jul 2019

When you top up $1k to your card to increase your credit limit and paying everything in credit, this will not result you in paying more compared to the first method you mentioned (paying $1k in cash and $1k in credit) as you already paid $1k when you did the top up.

By paying the $2k purchase through credit card, you will be entitled to more cashback/rewards (provided there is no cap for cashback/rewards)

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Yinghua Liu
Yinghua Liu

09 Jul 2019

For example, if your credit limit is $2k (before spending) and you spent $1k before your $2k purchase. By topping up, you pay back your $1k spent and ur credit limit is back to $2k for your $2k purchase. Statement will come and you have to pay $2k and not $3k. Cashback/rewards will be based on $3k. Hope this clarifies:)
Question Poster

10 Jul 2019

Got it!! Thank you for clarifying!! :)