The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired.

Annual percentage rate (APR) refers to the yearly interest rate you pay if you carry a balance on your credit card. The higher your APR and the longer you carry a balance, the more you'll pay in interest over time.

You can avoid paying interest on new purchases by paying your balance in full by the due date every month. That's because credit cards offer a grace period, a timeframe between the end of your billing cycle and payment due date, during which you won't incur any interest on purchases.

However, if you don't pay your balance in full by the due date, interest begins accruing daily on the remaining unpaid amount and is added to your balance. You may also lose your grace period on new purchases, which means new purchases accrue interest immediately from the date of transaction.

Cash advances and balance transfers work differently. Interest typically begins accruing on the day of the transaction, with no grace period at all. Cash advances may also carry a higher APR than the standard for purchases.

Some credit cards offer new cardholders 0% introductory APR offers on eligible purchases, balance transfers, or both for a set promotional period, typically 6 to 21 months. Once the period ends, you'll start incurring the regular APR on any remaining balance. With these cards you must still make at least the minimum monthly payment on time to keep the promotion active.

If you can't pay your full monthly balance, paying more than the minimum can help reduce your interest costs. The more you can pay toward your balance, the less interest you'll accrue.

tags : Credit Cards Interest Rates

Disclaimer: This editorial content is not provided or commissioned by the banks or credit card issuer(s). Opinions expressed here are the author's alone, not those of the banks or credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the banks or credit card issuer(s). Reasonable efforts are made to present accurate info, however all info is presented without warranty. Consult with the issuing bank of the card or account for terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are accurate as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.