Clearing the card balance

nuffznuff

Martin Lewis is always repeating the mantra "PAY IT IN FULL" to avoid credit card interest.

So what does "pay it in full" actually mean? Here's my scenario:

In Nov I had a zero balance and spent £200 halfway through the month, so at the end of Nov I have £200 to pay.

From what I understand, I have fifty-something days interest free credit, and so did not pay the balance (my statement confirms this was OK). That's £200 carried forward - the statement balance.

In Dec I spent another £100, so now I owe £300. So to avoid interest charges, can I get away with paying £200 (the statement balance) and carry forward the additional £100 or do I need to pay £300?

p00hsticks

I'm not quite clear from your post when your Statement Date is, but to avoid interest you need to pay off whatever it says is the balance on your monthly statement by the date it says that payment is due.

Most easily done by setting up a Direct Debit to pay the full statement balance ….

Shadyocuk

Unless you have a zero % purchases offer on your card , you needed to pay the £200 December statement balance by whatever your payment due date was (see your statemement) to avoid paying interest. I hope you at least paid the minimium payment by the due date ?

p00hsticks

'From what I understand, I have fifty-something days interest free credit, '

no you have up to fifty-something days interest free credit.

If you buy an item a day after your statement date, you'll have interest free credit for the whole of the next month until your next statement date, plus the days between the statement being issued and payment being due - typically around 56 days. If you buy an item the day before your statement is issued, then you'll only get a couple of weeks interest free credit.

If you haven';t paid a statement balance in full, note that you'll need to pay the next two statement balances in full before you stop paying interest (look up the term 'trailing interest' )

Peter999_2

Whatever your statement says you owe is what you need to pay to avoid interest. If you pay by direct debit and have selected the pay in full option then that is what will come out.

For example, I currently owe £487 on my credit card and am getting £10,000 of solar next week. My statment always comes out on the 15th and the direct debit on 1st of the next month. If I pay the £10,000 before the 15th February then I will pay it in March and not pay interest. However, if I don't pay the £10,000 before 15th February then it will appear on the 15th March statement and the direct debit won't come out until April.