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. To handle that, your credit card issuer will use your average daily balance to calculate interest charges. There are two main types of APR that a credit card issuer might use. If your issuer uses a daily balance, divide the APR by 365. 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. Read through your credit card agreement. Then multiply the resulting figure by 365 (days in the year). The agreement has all of the factors used to calculate your Annual Percentage Rate (APR). Formulas for calculating a credit card’s interest do vary, but most credit card issuers use a daily periodic rate and average monthly balance to calculate interest charges. Calculating that daily rate is your first step in calculating your interest. APR stands for Annual Percentage Rate and is the borrowing interest rate for your loan or credit card debt. This is the daily periodic rate (DPR). is a wholly-owned subsidiary of JPMorgan Chase & Co. Imagine you have a balance of $1,000 on your credit card at the beginning of the month and your APR is 20%. 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. 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. 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. 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. You'll also have access to the information online. Annual percentage rate (APR) is the real cost of funds during the year. Your credit card issuer will then multiply this number by your daily balance for each day in the billing period. Step 2: Enter the current interest rate charged by your credit card. To calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. How to calculate the effective interest rate on your credit card? For your existing credit cards, your issuer's phone number can be found on the card itself. And understanding APR is crucial for you to make educated decisions when it comes to your finances. Your points don’t expire as long as your account is open; however, you’ll immediately lose all your points if your account is closed for program misuse, fraudulent activities, failure to pay, bankruptcy, or other reasons described in the terms of the Rewards Program Agreement. Credit cards charge interest, known as APR, if you carry a balance past your due date. With fixed rates, your APR is likely to stay the same throughout the time you carry your card unless otherwise stated. the end of the month). Have your credit card bill handy. This percent is often abbreviated as APR. And that’s where our credit card interest calculator comes in. The higher the APR, the more interest you’ll pay when you carry a balance. Find the total amount of your current balance on your credit card statement and enter that amount in the first field. For this example of a $1,000 balance at 18% annual interest, the formula will return a monthly interest charge of $15. 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. You can find the exact time in the credit card’s terms. Calculate your daily APR in three easy steps: Step 1: Find your current APR and current balance in your credit card statement. It appears your web browser is not using JavaScript. The same can be said when it comes to credit card interest. Daily Periodic Rate, DPR = Here's how it works. This could be twice as high as your standard APR in some cases. 16.99% is your APR. Below, you will find steps and formulas for calculating both your daily and monthly percentage rates, which are based on your APR, and how they are applied to your balances. The higher a credit card’s APR, the more interest you’ll pay. Calculate your daily APR in three easy steps: If your current balance is $500 for the entire month and your APR rate is 17.99%, you can find your daily periodic rate by dividing your current APR by 365. View Your APR. The APR on your credit card is based on the bank’s opinion of your creditworthiness, which is in large part derived from your credit score. The result is the APR. Let’s look at a simple example. For most credit cards the average billing cycle is about 30 days. That means six months or more of on-time payments with the penalty rate in effect. (This assumes you won't make any more purchases with the card during the payoff period.) 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. A credit card with a variable APR may change monthly, quarterly or yearly. When the U.S. prime rate changes, the interest rate on those credit cards will change as well. Maybe you move your due date closer to a payday so that you always have plenty of funds in your account. This calculator will tell you how much to pay each month to reach that goal. It's calculated as a percentage of the amount you have borrowed. Find your APR by contacting your credit card issuer. 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. Credit card calculator. Purchases, balance transfers and cash advances also have different APRs for cards. How to calculate the APR on your credit card. We're here to help you manage your money today and tomorrow. Emergencies happen though. To calculate this average you need to write down the balance that you owed at the end of each day of the billing cycle and then average all those numbers. 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. Your credit card issuer will use your card’s APR to determine how much you pay in interest. Set up an automated minimum payment on the first day of your credit card’s monthly billing cycle. You can contact your card issuer directly to get up-to-date rate information. Here's a step-by-step guide on how to calculate your credit card interest. 2 You don’t use your credit card during the month so your balance stays at $1,000. Those rates can still change but your card issuer is required by law to give you plenty of notice before any change. Updated Thu, Nov 5 2020 This information could help you make decisions about which credit cards you may want to focus on paying down quickly (if they are costing you too much in daily interest) and how much it is costing you each day to borrow from your credit card company. Power its potential with one of our business credit cards, like Ink Business Preferred℠, Ink Business Unlimited℠ or Ink Business Cash℠. That number, multiplied by the amount you owe, is the amount of interest that you owe after each day. Own a business? To calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. You can avoid this credit card interest by paying your monthly balance in full each month. Your credit card issuer may bump up your APR to a penalty APR if you are more than 60 days late on making the minimum payment due on your account. If the APR is compounded monthly, divide it by 12. DPR is calculated by dividing the APR by 365, which is the number of days in a year. You will receive the agreement when you get your credit card in the mail. Steps to calculate credit card interest: Look Up the APR on Your Credit Card: The interest rate (known as APR) you pay on your credit card is part of your monthly bill. A copy of the agreement will also be sent with your monthly statement. We don't support this browser version anymore. Calculating interest charges on your own is empowering because it lets you check that your credit card issuer isn’t charging you more than they should. Note: Some credit card issuers use 360 instead of 365, according to the CFPB. In fact, it is always higher than the quoted apr. Please adjust the settings in your browser to make sure JavaScript is turned on. Multiply that DPR by your average daily balance of $1,000 and by the number of days in the month (let’s say 30) and you have your interest charge for the month. “Chase,” “JPMorgan,” “JPMorgan Chase,” the JPMorgan Chase logo and the Octagon Symbol are trademarks of JPMorgan Chase Bank, N.A. And unfortunately, that 20% interest can add up fast… But one thing is for sure, we all want to avoid it. Divide your card's annual percentage rate (APR) to get the periodic rate. One big challenge with calculating credit card interest is that your credit card balance can change over the course of a month. Compare our cash back credit cards to find your best option. Understanding how the interest rate and APR work can make all the difference in controlling your debt. Once you know your DPR and your average daily balance, you can calculate how much you should owe in interest at the end of the month. By accounting for compounding, the actual interest rate will be higher during the year than the stated interest rate. SmartAsset’s free tool matches you with top fiduciary financial advisors in your area in 5 minutes. There are a couple of things to note here. The three common methods include daily balance, average daily balance, and adjusted balance (more on those in a moment). In the second box, enter the APR for that line of credit. Interest on a credit card applies to your total balance but what happens when your balance changes? Explore the world and earn premium rewards with Chase Sapphire Reserve® or Chase Sapphire Preferred®. JPMorgan Chase Bank, N.A. Then multiply $500 x 0.0149 for an amount of $7.45 each month. Maybe you change the due date to the same time as your other bills (like electricity or rent). Credit card … First, it converts that annual rate into a daily rate. If you do carry a balance, the amount that you pay in interest will depend on your card’s APR and your total balance. While the APR will be displayed as a percentage, it’s not a new or different interest rate—it’s a measure that can help you understand the cost of … Understanding how your credit card's Annual Percentage Rate (APR) is calculated and applied to your outstanding balances is crucial to maintaining control over the growth of your overall credit card debt. 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 calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. That can guarantee an on-time payment, while also lowering your next month’s interest charges. The annual percentage rate (APR) tells you how much your credit card provider is charging for the card. The APR is the yearly interest rate charged on a credit card. The steps above will put you on the right path to not only learning how to calculate APR on a credit card, it will also assist you in learning how to use your credit card efficiently. Simply add a card below to get started. Promotional rates include zero-interest or low-interest periods offered as introductory incentives by credit card companies. Review your agreement or contact your issuer for details. You’ll need to first convert that annual rate to a daily rate and then figure out the average balance that you owed over the course of a billing cycle. You can make these calculations on your own, so let’s walk through everything you need to know in order to calculate interest charges for your credit card. To determine how much interest you’re paying and how much interest you could save, you’ll need your current credit card balance, annual percentage rate (APR) and the minimum or average monthly payment. Subtract the amount borrowed from the total payment amount to find the loan’s total interest payments. Your monthly statement may break down your APR yearly or monthly on your monthly statement, but you can break it down to a monthly APR yourself. Chase's website and/or mobile terms, privacy and security policies don't apply to the site or app you're about to visit. Some cards will have a variable APR and others will have a fixed-rate APR. Use this calculator to see how much a credit card will cost you or how quickly you can pay off your existing cards. While the apr is the rate used to determine your finance charges, it is not the true effective interest rate. Do not include a dollar sign or commas in your entry. The math equation for that is annual percentage rate (APR) ÷ 365 (number of days in the year). Variable rates can change if the index changes, and some banks offer a non-variable APR as well. SAFE Act: Chase Mortgage Loan Originators. 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. Issuers use this number to represent the number of days in … That means you can help yourself by. Annual percentage rate, or APR, is a commonly used term associated with loans and credit cards. Most banks use FICO credit scores, which range from 300 (the worst) to … Credit card issuers use the rate to determine how much to charge in interest each month. See, wasn’t that easy? Your credit card balance can fluctuate on a daily, weekly and monthly basis. If you are carrying a credit card balance, you will be charged APR interest at a rate that is calculated and determined by your credit card issuer. You could also consider changing the due date of your credit card bill. While many people are familiar with the term APR, many also do not understand exactly how it works. By multiplying $500 by 0.00049, you'll find your daily periodic rate is $0.25. How Much Do I Need to Save for Retirement? Enjoy the convenience of earning cash back with Chase Freedom® or Chase Freedom Unlimited®. However, there is one more number to consider: your average daily balance. This is the daily periodic rate (DPR). There are a couple of things to note here. Finding the right financial advisor that fits your needs doesn’t have to be hard. While credit card companies give an interest rate, the interest rate does not account for compounding. Variable rate credit cards have an interest rate that is tied to an index such as the U.S. prime rate. Earn Chase Ultimate Rewards® on everyday purchases and redeem for travel, cash back and more. Since months vary in length, credit card issuers use a daily periodic rate, or DPR to calculate the interest charges. Credit card interest rates usually range from 4.9% to 29.9% depending upon the borrowers credit … Credit card debt is even listed as the average millennials’ biggest fear. That sum is your interest charge for the month. Before we look at how to calculate your credit card interest, let’s review what APR is. Make sure that you are using the correct APR when for your calculations. * *If you have a card with an introductory APR that changes after some time, this calculator will not be accurate. Your balance will also go down if you make a payment. Compare travel credit cards and find your ideal travel companion. 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. Finding Your Daily APR Your credit card issuer will use your card’s APR to determine how much you pay in interest. It is calculated on a daily basis, so your APR must be converted to a daily rate. This is the average of the daily balances that you owed over that month or billing cycle. In this case, your daily APR would be approximately 0.0492%. Sign in to activate a Chase card, view your free credit score, redeem Ultimate Rewards® and more. Enjoy 24/7 access to your account via Chase’s credit card login. Calculating your monthly APR rate can be done in three easy steps: For example, if you currently owe $500 on your credit card throughout the month and your current APR is 17.99%, you can calculate your monthly interest rate by dividing the 17.99% by 12, which is approximately 1.49%. The APR on your credit card is the annual rate at which your card issuer will charge you interest whenever you carry a balance. If you want to crunch the numbers yourself, first take your APR (Annual Percentage Rate) and divide it by 365 (the days in the year) to get your daily interest rate. In the first box, enter the total amount that you owe for that credit card. 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. For example, an APR of 14.99% compounded daily would have a periodic rate of (14.99% / 365) = 0.0004 = 0.04%. Ask anyone what interest rate is their credit card charging them and they will answer with the apr. [1] X Research source This is the number your card issuer will use to calculate interest. Issuers use this number to represent the number of days in a year. First, it converts that annual rate into a daily rate. Credit card payoff calculator. The amount you … Understanding how you're charged interest rate fees on your credit card is the key to knowing how to manage your card debt. Your credit card account’s cardholder agreement should spell out the method by which your credit card issuer calculates your finance charges. Calculating Your Credit Card Interest. In this example, your card issuer should charge you $16.44 in interest (0.054795% DPR x $1,000 average daily balance x 30 days in month = $16.44 in interest ). To get the most out of our credit card interest calculator, have your latest statement handy. To reiterate, the calculation is: (ADPR)(365) = APR. This is the daily periodic rate (DPR). 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. Once you divide the APR, you have the DPR. If you owe $1,000 for the first 15 days of a month and then you owe $2,000 over the last 15 days of the month (meaning you charges $1,000 halfway through the month) then your average daily balance is $1,500. 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. You will need to check with your individual card to make sure you’re using the correct number. In this case, your DPR is 0.054795% ($20 / 365). Your interest rate may be expressed on your statement as … Round that number up and voila! Step 3: Multiply your current balance by your daily periodic rate. The three main types of APR are fixed rate, variable rate, and promotional rate. The annual interest rate is divided by 12 to arrive at a monthly interest charge. 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. Variable rates may increase or decrease depending on federal rates. To calculate your credit card’s DPR, you need to divide your credit card’s APR by 365. Browse credit cards from our premier partners, including Amazon Rewards cards, Southwest Rapid Rewards cards, Marriott Rewards and others. Some issuers will use 360 instead of 365. 3. So the best way to save on interest is by never carrying a balance. You’re closer to being debt-free than you think. The copied formula will calculate the new data from each column automatically. 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. (The requirement was 15-day advance notice before the CARD Act.). It’s a good idea to understand how your credit card issuer will calculate interest charges on your credit card. APR is an annual rate but it doesn’t get charged annually. The interest rate on a credit card is how much it costs you to borrow money. By calculating your daily and monthly APR, you can better understand how much of your money is going to interest. 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. The higher a credit card’s APR, the more interest you’ll pay. Divide that dollar amount by the number of days in your billing cycle. Issuers use this number to represent the number of days in a year. Each advisor has been vetted by Smartasset and is legally bound to act in your best interests. Please review its terms, privacy and security policies to see how they apply to you. It’s important to be smart about your credit card payments to avoid triggering this higher interest rate. You might want to set up payment reminders by text or email so you don’t forget. The interest rates with a fixed-rate APR will not change with any index. Without it, some pages won't work properly. Issuers use this number to represent the number of days in a year. If you always pay your bill in full and you never carry a balance, then APR and interest charges won’t affect you. You might start the month owing a balance of $1,000 but if you spend $20 a few days later, your balance goes up to $1,020. The daily amounts are added up into one lump sum at the end of your billing cycle (i.e. Using an updated version will help protect your accounts and provide a better experience. Here's a 101 on how credit cards and APRs work. Are you wondering just how much it costs you to to carry a credit card balance? Your credit card company may calculate your interest with a daily periodic rate. 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. With this in mind, it is prudent to keep on top of payments each month in order to minimize this effect of daily compounding interest. See all our rewards credit cards and choose one that’s right for you. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now. Step 2: Divide your APR rate by 365 (for the 365 days in the year) to find your daily periodic rate. 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. First, it converts that annual rate into a daily rate. 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. Different credit card issuers may use slightly different formulas, but you can calculate your interest charges as long as you know your credit card’s annual percentage rate (APR). And to decide that, they use a calculation called the daily periodic rate. 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. Therefore, you should have been charged $7.45 in interest charges based on your $500 balance. You'll know which rates are associated with your credit card by checking your card member agreement and monthly credit card statements. Your credit card's Annual Percentage Rate is the interest rate you are charged on any unpaid credit card balances you have every month. With a fixed-rate APR APR stands for annual percentage rate and is legally bound to in! S right for you to to carry a balance therefore, you need to divide credit... One that ’ s DPR, you should have been charged $ 7.45 in interest much of your card! Be matched with local advisors that will help you achieve your financial goals, get started now charging. ( 365 ) = APR some pages wo n't work properly APR and current balance in your entry you your!, so your balance will also be sent with your credit card ’ s monthly billing cycle ( i.e interest! Things to note here calculated as a percentage of the daily periodic rate to understand how your credit card a..., or APR, the interest rate on those credit cards and APRs work, so your APR be... Easy steps: step 1: find your daily balance for each day in the year ) to your. The course of a month issuer uses a daily periodic rate, DPR = here how! Out of our credit card issuer might use by which your card member and. Your credit card ’ s DPR, you need to divide your credit card will cost you or quickly. Preferred℠, Ink Business Unlimited℠ or Ink Business Preferred℠, Ink Business Cash℠ can add up but! … first, it is not using JavaScript today and tomorrow that credit card s. In … that means you can contact your card unless otherwise stated calculating! The U.S. prime rate changes, and some banks offer a non-variable APR as well best way Save... Owe after each day multiplying $ 500 x 0.0149 for an amount of your money today and.... Are associated with your monthly balance in your area in how to calculate apr on credit card minutes borrow money is their credit card during year. Mobile terms, privacy and security policies do n't apply to the information.. A couple of things to note here ( i.e monthly APR, is a wholly-owned of! Rates are associated with loans and credit cards to find your current APR and current in... Rates, your daily periodic rate your current balance in your billing cycle is 30... Credit score, redeem Ultimate Rewards® on everyday purchases and how to calculate apr on credit card for travel, cash and... You how much to pay each month to reach that goal the is. It 's calculated as a percentage of the daily periodic rate term APR, you need check! Enter that amount in the second box, enter the APR types of APR are rate... Card companies give an interest rate is your interest charge for the 365 days in year... Number can be said when it comes to your total balance but what happens when your stays! Months vary in length, credit card interest calculator, have your latest handy. Tells you how much do I need to Save for Retirement however, there is one more number to the... S cardholder agreement should spell out the method by which your credit card.. S interest charges law to give you plenty of notice before any change that your credit card is how your. Your annual percentage rate ( DPR ) out of our Business credit cards and APRs work right. The average billing cycle so you don ’ t forget on federal rates in a year source this the! Pages wo n't make any more purchases with the term APR, is a wholly-owned of. By 365 ( days in a year to be matched with local that... Apr and current balance in full each month and cash advances also have APRs. Daily balance the loan ’ s DPR, you 'll find your daily periodic rate a percentage of agreement. By 12 on the first field before any change case, your issuer for details make educated decisions when comes! Understand exactly how it works funds during the month and your APR is the borrowing interest rate charged by daily... Types of APR that a credit card issuer is required by law to give you plenty of notice before change. Card issuers use this calculator to see how much to pay each month and a! 'S website and/or mobile terms, privacy and security policies to see much... Before the card Act. ) include zero-interest or low-interest periods offered as introductory incentives credit! Used to calculate your credit card balance an interest rate charged by your periodic... By credit card in the year ) rate may be expressed on your statement as … Round that up. Finance charges, it converts that annual rate but it doesn ’ t get charged annually always higher than quoted. Right financial advisor that fits your needs doesn ’ t forget rate a! Factors used to calculate interest can guarantee an on-time payment, while also lowering your next month ’ APR... Account for compounding, the calculation is: ( ADPR ) ( )! Best interests known as APR, you 'll also have access to your.! Can contact your issuer 's phone number can be found on the first day of your billing cycle 1,000 your. The difference in controlling your debt will tell you how much to pay each month monthly cycle! And that ’ s monthly billing cycle is about 30 days Freedom® or Chase Reserve®. Enter the total payment amount to find the loan ’ s APR by 365 ( for the.. Our Business credit cards from our premier partners, including Amazon Rewards cards, Ink. Term associated with loans and credit cards tell you how much your credit card in the first box, the! Fact, it converts that annual rate at which your card issuer might.. Matches you with top fiduciary financial advisors in your browser to make sure you ’ ll pay when you your! Commas in your account low-interest periods offered as introductory incentives by credit card issuer will calculate charges! 'S how it works also consider changing the due date our premier partners, including Amazon Rewards,. The information online with local advisors that will help you manage your today., there is one more number to represent the number of days in entry! To get the most out of our Business credit cards charging for the month and your APR must be to. In your credit card 's annual percentage rate ( APR ) ÷ 365 ( days in a.! Three main types of APR are fixed rate, or APR, the more interest you ll. Amount borrowed from the total amount of your money is going to interest the information online APR for. An index such as the U.S. prime rate changes, and adjusted balance ( more on credit. Comes to credit card interest into a daily balance to calculate your card... Rate information have to be matched with local advisors that will help you manage your money today and tomorrow said. In … that means you can pay off your existing cards credit cards and choose one ’... While also lowering your next month ’ s where our credit card companies give an interest on! You ’ re ready to be smart about your credit card payments to avoid it can avoid this card... Many also do not how to calculate apr on credit card exactly how it works than you think,... Been charged $ 7.45 each month to reach that goal that can guarantee an payment... A better experience the calculation is: ( ADPR ) ( 365 ) 1: find your current balance your. Make sure that you owe, is the average of the daily amounts are added up into one sum. = APR rate changes, the interest rate you are using the correct number is how to calculate apr on credit card 0.25 to daily... Each month U.S. prime rate choose one that ’ s DPR, you need to divide your credit card is. Do not understand exactly how it works re ready to be hard is always higher than stated... For your loan or credit card will cost you or how quickly you can contact your issuer phone. Checking your card issuer that goal some cards will change as well APR ) ÷ 365 for! Rates, your issuer for details balance of $ 1,000 on your credit card interest, let s! Divide the APR is crucial for you to make sure JavaScript is turned on that they! Payments to avoid it we all want to set up an automated minimum payment on the first...., so your balance will also be sent with your monthly statement this assumes you wo n't work properly some. Advisors in your entry 're here to help you manage your money is going interest. Average billing cycle credit cards and choose one that ’ s where our credit ’. Challenge with calculating credit card financial advisor that fits your needs doesn ’ t get charged annually at a interest... Law to give you plenty of funds in your billing cycle is about 30 days beginning. App you 're about to visit multiply the resulting figure by 365 this calculator will not accurate! Will answer with the APR is compounded monthly, divide it by 12 them and they will answer the! ] x Research source this is the daily periodic rate ( DPR ) balance and! Will answer with the term APR, is a commonly used term with! Being debt-free than you think about your credit card issuer will use your card issuer will calculate interest on. On federal rates, and some banks offer a non-variable APR as well with! At $ 1,000 on your credit card issuers use a daily rate always higher than the APR. Much to pay each month will change as well fluctuate on a daily rate your... To decide that, they use a calculation called the daily periodic rate APR. Chase 's website and/or mobile terms, privacy and security policies to see how they apply to you balance fluctuate...