G'day, I'm Angus Kidman from Finder and
I'm here to tell you how you can save a fortune when you're shopping by taking
advantage of interest-free days on your credit card. When you're comparing credit
cards you'll notice that they often quote that they've got "up to" a certain
number of interest-free days. That might be 30 it might be 44 or it
might be 55. Knowing how those days work is really important to make
sure you don't pay more interest than you have to. Your interest free period
begins on the day your statement is issued and it finishes on the due date
when you have to make your next payment.
So that number of days you see that's
counted up to a certain figure is the maximum number of days that you
could go interest-free. If you make a purchase halfway through the month
you're not gonna get that maximum number. It could be a lot less and if you
don't pay the balance off then you will end up paying interest. So let's imagine
that I've got a card which has up to 55 interest free days. I've just
got my latest statement and I've just gone out and bought this shirt. I will
have a whole 55 days to pay that off and provided I pay for the shirt
before that time I won't end up paying any interest on it.
So the important thing
to remember is that as the due date gets closer the number of interest free days
goes down. So if I decide to buy this shirt next week then I'm only gonna get
48 days interest-free rather than the 55 I got for my first shirt. So
what happens when the credit card due date arrives? Well you could pay off the
whole balance and then you definitely won't owe any interest but if you had
those 55 days interest-free you could wait another 25 days before you had to
pay it and you still wouldn't attract any additional interest.
Our advice is
always pay off your card when you can but if you need to take advantage of
that flexibility try making purchases early in the month rather than later. For
more information about how interest free days work and to compare a wide range of
credit cards head over to finder.com.au. And if you want
advice on Hawaiian shirts give me a call..