What Is American Express Pay It Plan It?

Can AmEx Pay It Plan It help you pay off your debt sooner?

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Although American Express rolled out its Pay It Plan It feature in 2017, the program isn’t widely known. If you’re seeking a better way to manage your debt on an American Express consumer credit card, these twin options can help—but first, learn how they work.

What Is American Express Pay It Plan It?

Do you ever wish there was a way to break up your monthly payment? Or that you could put some of your bigger purchases on a payment plan instead of paying expensive interest

With certain American Express cards, the Pay It Plan It feature can help you do both. The feature is composed of two parts: 

  • Pay It: This lets you easily pay off recent charges through the American Express app.
  • Plan It: This lets you group purchases of $100 or more into a payment plan that can save you money. 

American Express offers some cardholders a third flexible payment scheme called Pay Over Time. If you opt in to that service, American Express will move eligible purchase balances into a Pay Over Time plan, and you will have the option of paying your monthly balance in full as usual or making a partial payment and carrying your Pay Over Time balance forward.

American Express Pay It

The Pay It feature lets you pay off charges below $100 before your payment due date, which frees up available credit. You can technically make payments whenever you want without this special feature, but it might be easier to do so with the American Express app, which is required to use Pay It.

To use this feature, find your recent purchases in the app. You’ll see a little “Pay It” button on the same line that you can click to indicate you’d like to pay off the charge.

You can only make up to five payments per day, which includes Pay It payments and standard payments.  

How Does Amex Pay It Affect Your Monthly Balance?

Pay It doesn’t technically pay off the charge you selected. Instead, your payment amount selected is applied toward your overall balance. You haven’t paid off one item while still owing on your other purchases. However, the overall result is the same (a lower balance).

If you have a minimum payment due, your payment is first applied to that. 

American Express Plan It

The Plan It tool is more complicated: You can choose up to 10 purchases of $100 or more each and lump them together into one payment plan, or you can enter a qualifying amount of $100. 

Then, you are offered a choice of one to three payment plan options ranging from three to 24 months in length. Your account history and your credit will influence the terms offered. Each option will have a different term length, monthly payment amount, and a finance charge. You can have up to 10 Plan It plans at any one time.

Paying charges this way could be beneficial in two ways. 

First, instead of paying the usual interest rate, you’ll pay a fixed monthly fee ranging between 0.61% to 1.17% per purchase. This may cost you less overall.  

Second, it’s a good way to pay off the balance within a reasonable time frame, with 24 months as the uppermost limit. If you only make minimum payments on a credit card balance, you could be paying off charges for far longer.

Some American Express credit cards may have limited-time introductory offers with 0% Plan It fees. 

Remember that it doesn’t make much sense to pay interest and fees to earn card rewards’ value. If you’re earning 1% in cash-back rewards but paying 1.17% in interest, it’s smart to avoid carrying a balance. 

How Are Payments Applied?

After you create your plan, you’ll receive an adjusted balance on your statement, including:

  • Purchases you made that month, in your remaining statement balance
  • Your monthly plan payment for all plans 

This can cause your monthly payment to increase substantially. If you pay off the entire adjusted balance, you won’t be charged interest on new purchases.

Any extra payments beyond the minimum due will be applied to your outstanding balance (adjusted balance). If you have multiple plans, you can’t pick and choose which plan to pay off first.

Plan It Limits

Although Pay It Plan It can be a useful tool, be aware of potential limitations, especially where the Plan It tool is concerned: 

  • You can’t cancel a plan or change a plan’s purchases, terms, or payments except by paying the credit card balance in full. 
  • You won’t know the plan’s exact terms before making a big purchase or get otherwise preapproved. AmEx’s Plan It Calculator can give you an idea of payment plans, but there’s no guarantee you’ll get one of those plans. 
  • A plan can’t exceed 95% of your credit limit. 
  • If you miss a minimum payment, your entire account could go into default.
  • Some items on your bill might not qualify, such as purchases that might generate foreign transaction fees.
  • If you get a store refund for a purchase already in a plan, you must call to have the credit applied.
  • If you currently have a 0% introductory interest rate, Plan It may not offer an advantage unless you think you might lack the discipline to pay off your balance. 

How Do You Apply for American Express Pay It Plan It?

You can’t apply for the Pay It Plan It feature. You must have an eligible American Express card or apply for a new eligible card. It’s currently available only for consumer American Express cards and not available for small-business cards. 

Even if you have a card that offers Pay It Plan It, it’s possible in some cases that you won’t be able to take advantage of it, such as if your account was opened at a different time or due to the account status.

Should You Use American Express Pay It Plan It?

If you already pay off your credit card bill in full each month, chances are you won’t find these tools very useful. But in some cases, they could be a great help, such as when you want to:

  • Earn rewards but don’t want to fall further into debt: With the Pay It feature, you can minimize your balance by making small payments throughout the month while earning AmEx rewards on your purchases. However, if you use the Plan It feature, remember that the plan fee doesn’t outweigh what you’re earning in rewards.  
  • Save money on interest: The finance charge with Plan It may be less than if you’d paid the usual interest rate. Use a credit card payment calculator to compare interest charges versus Plan It’s fixed-rate finance charge. 
  • Pay down your balance faster: If you only make the minimum payments, you could be in debt for a long time. By bundling your large charges into a Plan It plan, you could pay off that debt sooner.