Comments on: Understanding how interest is calculated on credit cards

By: bluntmoney

bluntmoney — Sat, 26 Sep 2009 16:03:21 +0000

Cassandra, your card should tell whether they charge on the balance daily or not. A lot of them charge on the average daily balance, which isn’t quite the same thing.

By: Cassandra

Cassandra — Fri, 25 Sep 2009 15:05:16 +0000

Thanks for the interest rate explanation. So if my statement says that it’s x percentage for a daily periodic rate, then they charge interest on the balance daily? Compound interest really works against you on credit cards… ick. One more reason to pay off all my debt as soon as possible.

By: bluntmoney

bluntmoney — Wed, 23 Sep 2009 12:04:02 +0000

Mrs. Accountability, that looks right to me.

By: Mrs. Accountability

Mrs. Accountability — Tue, 22 Sep 2009 18:01:49 +0000

For some reason I always have a hard time remembering how to calculate the APR, and your example is so simple when figuring the monthly. Would you mind giving the same example, but with the daily? Or wait, let me try: For monthly, you had: 12% (.01 x 12 = .12). So… 14.99% (0.00041068 x 365 = .1499). Or did I put in too many zeroes? So basically, take 14.99% and divide it by 365, or using decimal point .1499 divided by 365 to get a daily rate. Cool! Thanks!

By: bluntmoney

bluntmoney — Tue, 22 Sep 2009 12:37:06 +0000

jacqueline E., I wouldn’t apply for more than one card if it were me, and I would never carry a balance. Really if it were me I wouldn’t have applied for another card at all, until I was convinced I could handle it. While I didn’t go bankrupt, I did get into trouble with credit cards in the past and it took me 5 or 6 years before I felt ok with getting one again.

By: jacqueline E.

jacqueline E. — Tue, 22 Sep 2009 04:09:44 +0000

I filed for bankrupcy a few monthes ago. All my debts were discharged 2 monthes ago and now, I am already offered a new credit card. Knowing it is important to prove you can use it wisely, I applied and got approved for a credit line of $350.00.
Yes, the interest is high (23.99%) with a yearly fee of $69.00 and a monthly fee of $5.75.
What is the best way to use it?….I was told to use it to pay one bill (my dishnetwork bill, in my case) and pay in full every month.
Should I get more than one credit card?…

By: bluntmoney

bluntmoney — Tue, 22 Sep 2009 00:54:43 +0000

Thanks :)