Credit Card Statement Balance Vs. Current Balance. At the end of every billing cycle, your credit card statement is normally sent. To you which contains your statement balance. However, if you check your. Credit card balance by phone or online, you may be presented with two different balances: the statement balance and current balance. This can be quite confusing. Because they may reflect different figures.
What Balance Appears on Your Credit Card Statement?
The statement balance is the one that was printed on your. Most recent credit card billing statement. That is the amount as of your account statement closing date. It is not uncommon for the statement balance to be different from your current balance.
The balance that appears on your credit card statement is often the one that is reported to the credit bureaus. This explains why the balance on your. Credit report often doesn’t reflect your current balance.
Credit Card Statement Balance Vs. Current Balance – Why the Difference?
Your credit card activity is billed in cycles. When a billing. Cycle ends, the credit card issuer prints a statement detailing the activity that occurred during that billing cycle and informing you of the payment due and the due date.
Since the time of printing, you may have made purchases. Payments, or other transactions that changed your outstanding credit card balance. These transactions are reflected in the current balance. The current balance could be higher or lower than your statement balance depending on the transactions you’ve made.
If you check your account online or over the phone, your. Current balance may include pending transactions. These are transactions you’ve made, typically within the last 24 to 48 hours, that haven’t posted to your account yet. Your credit card issuer has received notification of these transactions, but they haven’t completely been processed.
Which Balance to Pay to Avoid Interest Charges
So, which one should you pay to avoid interest charges? To avoid paying finance charges, you typically need to have started the billing cycle with a. $0 balance or at least have paid your previous bill in full before the end of the grace period. The statement balance you see may already include a finance charge if you didn’t. Pay in full in the previous billing cycle.
You’ll be left with a balance on your credit card if you pay the full statement balance and your current balance is higher than that amount. You’ll see that leftover plus any new transactions on your next billing statement.
How about the current balance?
Paying the full current balance is also good, especially if you want to have a low or zero balance on your next credit card billing statement. If you want to pay off your credit balance down to zero, contact your credit card issuer to find out the “payoff balance” which may include finance charges that haven’t been added to your account yet.
When you can’t afford to pay the entire statement balance, you must pay at least the minimum to avoid receiving late payment penalties. Or, pay more than the minimum if you can afford it, to reduce your credit card bill faster and reduce the amount of interest you pay over time.