Chosen by Asker

It depends on your balance and your interest rate. For example, if your APR is 20%, and your average daily balance is $500, then you'd get billed about $8.33 a month for that balance. How you calculate your interest is, you take your balance, here $500, then you multiply it by your APR - 20%. This gives you $100 - but wait - APR means Annual Percentage Rate, so the $100 is what you'd be billed for a full year of carrying a $500 balance. Divide that $100 by 12 (months in a year), and you get about $8.33. Simply put, the equation is (<bal> x <APR>) / 12. As mentioned before, though, if you pay your bill in full by the due date, instead of making minimum payments or something, then you don't get any interest charged at all.

Source(s)

Credit industry for 15+ years.

by Carlii

5 months ago

Asker's Rating: 

I have paid no interest on any credit card in 20 years. I never have a balance owing when due date comes around. I even have a credit card that charges 18% per annum, but they too never get a penny of interest because I pay them off well before due date. So why have a card that I pay off and never pay interest? I get a minimum of 1% cash back on everything I spend on these cards, some savings up to 4%. They are using these inducements to get me into debt, I know that, but I am using their credit cards just to save money with no intention to stay in debt even one month. I purchase from 1200 to 2000 on credit cards each month, and I get some extra incentives because of larger spending. But the interest is still zero because I pay it all off.

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by mr.momo- 5 months ago