Many credit cards offer an interest free period on purchases. If your card features include a certain number of interest free days, you should definitely take advantage of it. Here is a detailed guide to getting the most out of this feature.
Most credit cards offer a certain number of interest free days on purchases. This is a grace period during which any purchases made using the credit card will not accrue interest. Certainly one of the more attractive card features, interest free periods are also very useful as a tool to help you manage your finances better. And yet this is often overlooked as other card features such as balance transfer rates, reward points offered etc. take precedence in the mind of the consumer. If you are a savvy cardholder who wants to get the most out of their credit card, then pay attention to the following discussion.
Understanding Interest Free Days
The number of interest free days offered varies from one card to the next, but is usually something between 42 days to 70 days. Grace periods longer than 60 days are quite uncommon however, most likely your card features around 55 days of interest free period. Check your credit card terms to find out the exact number of days applicable to you.
You will notice that your card provider will mention something like up to 55 days interest free on purchases (for instance). The reason that the number of interest free days quoted is not a fixed number, but rather an upper limit, is because of the way it is calculated and applied.
Say you bought something on the 3rd of April, and your statement period starts from the 15th of the month. In this case you might be expecting to get interest free period of 55 days, which would mean your purchase on the 3rd of April to start accruing interest from 28 May. However this particular purchase would start gathering interest after the due date of payment indicated on the April statement, which would effectively reduce the number of interest free days down to 42 (assuming the repayment date is 30 days after the statement date).
As you can see, interest free period is not one of the easiest card features to grasp. But once you know how they are applied to your card expenditures, you are well equipped to make the most out of this feature. The most optimum use for the customer would be to make bigger purchases at the beginning of the credit card statement cycle. This way the cardholder gets to enjoy the maximum period of interest free days on their credit card.
