- Know when your grace period ends.
- Use a personal loan instead.
- Pay your balance in full every month.
- Get a credit card with a 0% intro APR.
- Transfer your balance to a credit card with a 0% intro balance transfer APR.
- Pay more than the minimum payment.
- Make payments on time.
- Keep your credit utilization low.
- Use a credit card rewards program to get cash back or travel rewards.
- Consider a credit card with no annual fee.
Here are some tips on how you can avoid paying interest on your credit card. By following these tips, you can keep more of your money in your pocket.
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Know when your grace period ends.
Your grace period is the time you have to pay your credit card bill in full without being charged interest. The standard grace period is 23 days, but it can be as short as 20 days or as long as 30 days. Many issuers allow you to choose your billing cycle when you open your account, so make sure you know when yours ends. If you’re not sure, you can always call your issuer and ask. You’ll also want to know if your issuer uses the adjusted balance or average daily balance method to calculate interest.
Most issuers use the average daily balance method, which takes the average of your balance during the billing cycle and multiplies it by the daily periodic rate (APR) and the number of days in the billing cycle. So, if your APR is 15% and your average daily balance is $1,000, you would owe $15 in interest for that month ($1,000 x .15 x 30).
Some issuers use the adjusted balance method instead. This method applies interest charges only to the portion of your balance that you carried forward from the previous billing cycle, plus any new charges or other Adjustments that post during the current billing cycle. It doesn’t include payments or credits that are applied during the billing cycle (like rewards earned). So, if your ending balance from last month was $1,000 and you made a $200 payment on the first day of this month’s billing cycle, under this method only $800 would be subject to interest charges for this month ($1,000 – $200).
Use a personal loan instead.
If you’re struggling to pay off high-interest credit card debt, you might be better off taking out a personal loan and using the money to pay off your balances.
Personal loans typically have lower interest rates than credit cards, so you’ll save money on interest charges. Plus, personal loan terms are usually shorter than credit card terms, so you’ll be debt-free sooner.
Here’s how it works: You take out a personal loan and use the money to pay off your credit card balances. Then, you make monthly payments on your personal loan (usually at a fixed interest rate).
Since personal loan interest rates are usually lower than credit card interest rates, this can help you save money on interest charges and get out of debt faster.
Pay your balance in full every month.
If you carry a balance on your credit card from month to month, you will be charged interest on that balance. The amount of interest you’ll be charged depends on your APR (annual percentage rate), which is the interest rate the credit card issuer charges on balances.
You can avoid paying interest on your credit card balance by paying the full balance every month before the due date. If you can’t pay the full balance, try to pay as much as you can so you’ll owe less interest.
Some credit cards offer a grace period during which you won’t be charged interest if you pay your balance in full. A grace period is usually 20 to 25 days from the end of the billing cycle, but it can be shorter or nonexistent if you’re carrying a balance. If your credit card doesn’t have a grace period, any new purchases will start accruing interest immediately.
Another way to avoid paying interest is to take advantage of a 0% APR introductory offer. These offers are typically for new credit card customers and last for 6 to 18 months. During this intro period, no interest is charged on purchases or balance transfers (and sometimes both). After the intro period ends, any remaining balance will start accruing interest at the regular APR.
Get a credit card with a 0% intro APR.
If you carry a balance on your credit card, you probably dread the day when your monthly statement arrives, showing how much interest you owe.
Fortunately, there are steps you can take to avoid paying interest on your credit card balance. One is to get a credit card that offers a 0% intro APR on purchases or balance transfers.
With a 0% intro APR credit card, you can avoid paying interest on your balances for a certain period of time, usually 12 to 21 months. This can give you some breathing room to pay down your balances without accruing interest charges.
Just be sure to pay off your balances before the intro period ends, or you’ll be stuck paying interest at the card’s regular APR, which is usually higher than 20%.
Transfer your balance to a credit card with a 0% intro balance transfer APR.
If you have credit card debt, you’re not alone. In fact, the average American household has $5,700 in credit card debt.1 And if you carry a balance on your credit cards from month to month, you’re probably paying interest on that debt. The good news is that there are ways to avoid paying interest on your credit card balance.
One way to avoid paying interest on your credit card balance is to transfer your balance to a credit card with a 0% intro balance transfer APR. This means that you will not have to pay any interest on your balance for a set period of time, typically 12 to 18 months. There are a few things to keep in mind when considering a balance transfer, however. First, make sure that you will be able to pay off your balance before the intro period ends, as any remaining balance will be subject to the card’s regular APR (which will likely be higher than the intro APR). Second, be aware of any balance transfer fees that may apply; these fees are typically 3% of the amount being transferred, but can vary depending on the card.
Another way to avoid paying interest on your credit card balance is to pay more than the minimum payment each month. By doing this, you will reduce your principle balance and pay less interest over time. You can also ask your credit card issuer for a lower APR; while they may not be able to lower your rate significantly, it may help save you some money in interest charges over time.
Finally, remember that using a credit card responsibly is the best way to avoid paying interest on your balances. This means making payments on time and in full each month, and only charging what you can afford to pay back within a reasonable period of time. If you do find yourself carrying a balance from month-to-month, following these tips can help you avoid paying interest and save money in the long run.
Pay more than the minimum payment.
To avoid paying interest on your credit card, you should always pay more than the minimum payment. The minimum payment is the smallest amount of money that you can pay each month to keep your account in good standing. It is usually a very small percentage of your total balance, so you will still owe a lot of money if you only make the minimum payment.
If you have a high interest rate, it can be difficult to pay more than the minimum payment. In this case, you may want to consider transferring your balance to a credit card with a lower interest rate. You can also try negotiating with your credit card company for a lower interest rate.
Paying more than the minimum payment will help you pay off your balance faster and save money in interest charges. If you are having difficulty making larger payments, there are several options that can help you make progress on paying down your credit card debt.
Make payments on time.
One of the best ways to avoid paying interest on your credit card is to make your payments on time. This means that you should try to pay off your balance in full each month. If you can’t do this, then you should at least make the minimum payment by the due date.
If you make a late payment, you may be charged a late fee. But more importantly, the late payment will be reported to the credit bureaus. This can hurt your credit score and make it harder to get approved for new credit in the future.
You can avoid late payments by setting up automatic payments from your checking account. That way, you’ll never have to worry about forgetting to make a payment. Just be sure to keep enough money in your checking account to cover the payments.
Keep your credit utilization low.
The best way to avoid paying interest on your credit card is to keep your credit utilization low. Credit utilization is the amount of your available credit that you are using at any given time. For example, if you have a credit limit of $1000 and you have a balance of $500, your credit utilization would be 50%.
Ideally, you should aim to keep your credit utilization below 30%. This shows creditors that you are a responsible borrower and are not overextending yourself. If you keep your credit utilization low, you will be less likely to be charged interest on your outstanding balance.
Use a credit card rewards program to get cash back or travel rewards.
If you have a credit card with a high interest rate, you may be looking for ways to avoid paying interest on your balance. One way to do this is to use a rewards program that offers cash back or travel rewards. By using your points or miles to pay for your travel expenses, you can avoid paying interest on your credit card balance. Another way to avoid paying interest is to transfer your balance to a low-interest credit card. This can help you save money on interest charges and help you pay off your balance faster.
Consider a credit card with no annual fee.
An annual fee is a charge you pay every year just for having the card. Some cards with annual fees have benefits that may be worth the fee, such as a rewards program or a 0% APR introductory period. But if you carry a balance on your card and pay interest, the annual fee could offset any benefits you receive.
If you’re trying to avoid paying interest, look for a credit card with no annual fee. You can find plenty of options from major issuers, including cards with rewards programs and 0% intro APRs.