Using an updated version will help protect your accounts and provide a better experience. Credit card interest rates usually range from 4.9% to 29.9% depending upon the borrowers credit … In the second box, enter the APR for that line of credit. You will also need to keep that penalty APR for a certain amount of time before your credit card issuer will even think about lowering your APR back to normal. Maybe you move your due date closer to a payday so that you always have plenty of funds in your account. Just enter your current balance, APR, issuer and monthly payment to see how long it will take to pay off your balance and how much you’ll pay in interest. If you do carry a balance, the amount that you pay in interest will depend on your card’s APR and your total balance. Please adjust the settings in your browser to make sure JavaScript is turned on. Compare the Top 3 Financial Advisors For You, Remember that you won’t have to pay any interest if you pay your credit card bill in full by its due date. How Much Do I Need to Save for Retirement? Divide that dollar amount by the number of days in your billing cycle. In order to calculate the monthly interest charges to your balance you simply need to multiply this daily periodic rate by the number of days in your billing cycle. Step 2: Divide your APR rate by 365 (for the 365 days in the year) to find your daily periodic rate. One day I was looking at my credit card monthly interest charges.Then I figured I should try calculating how much I would end up saving by transferring my balance from one credit card to another credit card with a different APR (Annual Percentage Rate) and taking into consideration the transfer fees I would have to pay. Monthly APR can also help you understand how much it is costing you to carry a balance each month that you are not paying down the entire balance. A copy of the agreement will also be sent with your monthly statement. Calculate your APR (annual percentage rate) for each billing period by adding in all of the finance charges you paid that month, including interest on all balances, balance transfer fees and other transaction fees. Divide your card's annual percentage rate (APR) to get the periodic rate. However, there is one more number to consider: your average daily balance. If your issuer uses a daily balance, divide the APR by 365. Enjoy 24/7 access to your account via Chase’s credit card login. Calculating Your Credit Card Interest. The three common methods include daily balance, average daily balance, and adjusted balance (more on those in a moment). So the best way to save on interest is by never carrying a balance. Photo credit: ©iStock.com/SIphotography, ©iStock.com/vgajic, ©iStock.com/Pawel Gaul, Bank of America® Travel Rewards Visa® Credit Card Review, Capital One® Quicksilver® Cash Rewards Credit Card Review, 7 Mistakes Everyone Makes When Hiring a Financial Advisor, 20 Questions to Tell If You're Ready to Retire, The Worst Way to Withdraw From Your Retirement Accounts. By figuring out the daily periodic rate on your credit cards, you can have a better understanding of how compound interest is affecting how much you're paying back in interest. View Your APR. Without it, some pages won't work properly. To calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. The three main types of APR are fixed rate, variable rate, and promotional rate. Compare travel credit cards and find your ideal travel companion. For this example of a $1,000 balance at 18% annual interest, the formula will return a monthly interest charge of $15. To get the most out of our credit card interest calculator, have your latest statement handy. To reiterate, the calculation is: (ADPR)(365) = APR. Here’s how to calculate APR for a car loan in four steps: Get the total payment amount by multiplying the monthly payment by the term of the loan in months. Own a business? A higher purchase APR (annual percentage rate) means you will owe more in interest if you carry a balance, while a lower purchase APR means you will owe less. You’re closer to being debt-free than you think. Find your APR by contacting your credit card issuer. Understanding how much of your money is going to interest rather than your balance may also motivate you to pay off your debt or help you decide what purchases are worth putting on the credit card. This may sound challenging, especially if math isn’t your strong suit, but you can handle it easily with the help of a calculator or spreadsheet app. 2 Chase isn’t responsible for (and doesn't provide) any products, services or content at this third-party site or app, except for products and services that explicitly carry the Chase name. The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 requires credit card issuers to give 45-day advance notice of any interest rate increases. By breaking down your interest rates on a daily and monthly basis, you can learn more about the interest you are accruing over time and use this information to make some of your financial decisions. The APR is the yearly interest rate charged on a credit card. Here's how it works. One big challenge with calculating credit card interest is that your credit card balance can change over the course of a month. And to decide that, they use a calculation called the daily periodic rate. Here's a step-by-step guide on how to calculate your credit card interest. For credit cards, interest is usually expressed as a yearly rate, but credit card companies will use it to calculate the interest charged during your monthly statement period. the end of the month). By accounting for compounding, the actual interest rate will be higher during the year than the stated interest rate. By calculating your daily and monthly APR, you can better understand how much of your money is going to interest. To understand how much you’re going to pay in interest, you will need to understand how your card’s annual percentage rate (APR) works. Enter your credit card's current balance, its annual interest rate, and the amount of time in which you'd like to get the card paid off. Understanding how you're charged interest rate fees on your credit card is the key to knowing how to manage your card debt. That can guarantee an on-time payment, while also lowering your next month’s interest charges. The copied formula will calculate the new data from each column automatically. And that’s where our credit card interest calculator comes in. Then multiply the resulting figure by 365 (days in the year). Credit card payoff calculator. In this case, your DPR is 0.054795% ($20 / 365). Chase's website and/or mobile terms, privacy and security policies don't apply to the site or app you're about to visit. How to calculate APR Many variable interest rates start by using an index, such as the U.S. Prime Rate, and then add a margin. Annual percentage rate, or APR, is a commonly used term associated with loans and credit cards. It's calculated as a percentage of the amount you have borrowed. Credit card issuers use the rate to determine how much to charge in interest each month. To handle that, your credit card issuer will use your average daily balance to calculate interest charges. You will receive the agreement when you get your credit card in the mail. The APR calculation takes into account for the interest rate, how often it's charged, initial fees and any other costs associated with the loan. Read through your credit card agreement. This calculator will tell you how much to pay each month to reach that goal. It is calculated on a daily basis, so your APR must be converted to a daily rate. A loan’s APR is calculated by determining how much the loan is going to cost you each year based on its interest rate and finance charges. To begin, you need to look at your credit card statement and determine what your annual interest percentage rate is for your credit card account. Simply add a card below to get started. The interest rates with a fixed-rate APR will not change with any index. That sum is your interest charge for the month. (This assumes you won't make any more purchases with the card during the payoff period.) To calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. 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