saving spending and credit

The Grace Period

The grace period is the number of days before interest is charged on new purchases. It normally amounts to 21-30 days. How does the grace period work?

A. It only applies if you've paid off your balance in full the previous month.

B. It doesn't prevent you from paying interest even if you pay your bill in full each month.

C. If you have good credit, you probably won't qualify for this feature.

"A" is correct. A grace period usually starts on the billing date. It can help you avoid finance charges, because it gives you a little more time to pay your bill. Grace periods may not apply to certain types of balances, such as cash advances and balance transfers. You are more likely to qualify for a longer grace period if you have a good credit history. Check to see what types of balances yours covers.