How much interest will I have to pay?
If my rate is 10.9 and my balance at the end of the month is 150$? And explain how you got this calculation?
Thanks!!
If my rate is 10.9 and my balance at the end of the month is 150$? And explain how you got this calculation?
Thanks!!
?
Favorite Answer
10.9% is your interest rate for the year. You get charged 1/12th of that per month on purchases which have passed their grace period.
If the $150 balance at the end of the month is all new purchases, you will not be charged any interest this month. Pay off your bill in full and you won't be charged any interest period. All new purchases have a "grace period" where you don't pay interest and you are given an opportunity to pay them off without accruing any interest.
If however these are purchases from last month you haven't paid off yet, then you are charged 1/12th of 10.9% as interest.
1/12 * 10.9% * $150 = $1.36 interest.
Keep in mind though even though your interest is pretty cheap it's absolutely imperative that you get into the habit of paying off your credit card balance in full every month. Your interest rate may not always be this low and carrying a balance over the long term will cost you a small fortune. In some cases if you pay only the minimum payment on your credit card you end up dragging out paying off the balance for so long that in the end you've paid back twice as much as the original bill or more! (i.e. a $1000 bill ends up costing you $2000 after the months and months of carrying the balance)