January 11, 2014
When do you lose the grace period on a credit card and when do you keep it? Why is this important?
When do you lose the grace period on a credit card and when do you keep it? Why is this important?
The grace period is the time when you can pay of your credit card debt to avoid paying interest. The grace period is only before the cards due date. This date depends on each persons credit card. Most are about 25 days. It is important because you can avoid paying any interest if you pay on time.
You lose the grace period if you do not make a payment and have a balance left on your card. You also loss the grace period if you take a cash advance. You will have the grace period as long as you pay off your credit card in full every cycle. It is important to consider these things when using your credit card. If you want to avoid paying interest and have free money for short periods of time use the grace period to the best of your ability. You can sometimes time a larger purchase at the start of your new cycle so you will not have to pay it off for close to 2 months until the cycle is over and the payment is due, this will let your money work for you more in that time.
Great comments gentlemen. I have nothing to add.