So I just got my first credit card with Discover last week, and I see that after three days my first couple purchases have been posted.

I tried paying off the purchases posted, but after submitting payment it told me there is a credit balance.

I'm not entirely sure what that means, is that a good thing or a bad thing ?


Things are generally fine. A credit balance is not a horrible thing.

The argument against maintaining a credit balance is that you are essentially loaning the credit card issuer money at 0% interest. You probably have alternative investments that would pay better interest, so it's usually better to park your money there. All that said, it's unlikely that the interest on whatever balance you have is enough to be more than pennies.

The way that a credit card works, you run up a balance in one period. Then there is a grace period. If you don't pay off the balance during the grace period, they start charging you interest. You also may have a minimum payment to make. If you don't make that payment, they'll charge you a late fee.

The typical period to rack up charges is from the first to the last day of a month. The typical grace period is through the 20th or 25th of the next month. Your card may be different. So check the documentation (user agreement) for your card if you want the real data.

It sounds like you paid off some purchases while you were still in the period where you rack up charges. While those purchases were posted to the account, they may not be counted in the balance calculation. If your credit balance exactly matches the payment you made, that's probably what happened. It's also possible that you overpaid the balance. If your credit balance is just a small amount, that's probably what happened.

If you really want to be sure, you should call the credit card issuer and ask them. At best we can tell you how it normally works. Since this is your first month, you could just wait for your first bill and respond to that. So long as you pay off the entire balance shown there by the deadline, everything should be fine.

Don't wait until the last day to pay. It's usually best to pay a week or so early so as to leave time for the mail to deliver the check and for them to process it. You can wait longer for an online payment, but a few business days early to give you a chance to handle potential problems is still good.

  • Most credit card web sites allow you to schedule a payment at any time during the grace period (and sometimes till the end of the monthly cycle). I find it convenient to schedule paying off the monthly balance in full on or just before the due date as soon as I get the email saying that the monthly statement is ready. I also enter the payment into my checkbook (actually Quicken file) right away so that I don't forget and spend the money on something else. – Dilip Sarwate Aug 23 '16 at 22:55

A Credit Balance means that you overpayed. That's nothing to worry about; it will just be used up by your next charges.

Note that this can have two reasons - either you really paid too much; or you paid off a charge that is still 'pending' - meaning it has not yet posted and is not considered in the amount you owe: Most charges in restaurants for example are pending for a day or more, because the original charge is your bill without tip (they don't know the tip when the run the card!), and the merchant spends his weekends or evenings to type in the final amount (including tip) and post the pending charge. If this is the case, it will settle ('get posted') in a day or two, and then it will match up.

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