What are The Uses of Float?

Business & Management
#1

Individuals frequently take advantage of float. Amanda, for example, has a $500 credit card payment due on April 1st. Even though she doesn’t have $500 in her bank account, she writes and submits a check for that amount on March 23. She understands, however, that her paycheck will be transferred into her bank account by March 25—and that the credit card company will most likely not receive and submit her check for payment until April 1. For those days, she has $500 in float (the time between when she writes her check and when it clears).
If she was tech-savvy, she could essentially do the same thing on March 23 by going online and booking an electronic payment on the credit card company’s website for April 1, again depending on her bank to have deposited her paycheck by March 25.