Statement Balance
Financial term in the General category
Definition
The total amount owed on a credit card at the end of the billing cycle. Paying this amount in full by the due date avoids interest charges and maximizes the grace period.
Related Terms
Billing Cycle
The period between credit card statements, typically 28-31 days. Purchases made during this cycle appear on the next statement and are due 21-25 days after the statement closing date.
Minimum Payment
The smallest amount you must pay each month to keep the account in good standing, typically 1-3% of the balance or $25-35, whichever is greater. Paying only the minimum results in expensive long-term interest.
Grace Period
A period after a payment due date during which you can pay without penalty. Credit cards typically offer 21-25 days; student loans often offer 6 months after graduation.
Frequently Asked Questions
What is Statement Balance?
The total amount owed on a credit card at the end of the billing cycle. Paying this amount in full by the due date avoids interest charges and maximizes the grace period.
Why is Statement Balance important in personal finance?
Statement Balance is an important general concept that helps individuals make better financial decisions. Understanding Statement Balance can improve your financial planning and help you achieve your money goals.
How does Statement Balance relate to Billing Cycle?
Statement Balance and Billing Cycle are related financial concepts. The period between credit card statements, typically 28-31 days. Purchases made during this cycle appear on the next statement and are due 21-25 days after the statement closing date.
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