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Credit Card Interest Calculator

Estimate credit card interest on an unpaid balance from APR, average daily balance, and billing-cycle length.

Credit card interest

Interest on an unpaid balance is usually figured daily from your annual rate, then totaled for the billing cycle.

%

Purchase APR on unpaid balances. Promotional 0% rates charge nothing until they end.

$

Add each day’s unpaid balance, then divide by the days in the cycle.

Often about 28–31 days. Issuers use the actual cycle length.

Interest this billing cycle

$7.81

On an average daily balance of $500.00

Daily rate

0.0521%

Daily interest

$0.26

APR ÷ 365

19% / 365

Cycle length

30 days

How this cycle’s interest is built

  1. Daily rate = 19% ÷ 365 = 0.0521%.
  2. Average daily balance = $500.00.
  3. Daily interest = balance × daily rate = $0.2603.
  4. Cycle interest = daily interest × 30 days = $7.81.

Paying the statement in full before the grace period usually means no purchase interest. If you carry a balance, smaller payments earlier in the cycle reduce the average daily balance and the charge.

Cycle interest

$7.81

19% APR · 30 days

How it works

Credit card purchase interest on a carried balance is usually calculated every day, then added up for the billing cycle. The daily rate is the annual percentage rate divided by 365.

Average daily balance is the sum of each day’s unpaid balance divided by the number of days in the cycle. Multiply that average by the daily rate to get one day’s interest, then multiply by the cycle length for the month’s charge.

Example: a 19% APR on a $500 average daily balance for 30 days is about $7.81 of interest (19 ÷ 365 × $500 × 30). Rounding the daily rate early can shave a cent or two.

If you know a starting balance and one payment date instead of the average, the calculator estimates the average: days before the payment stay at the higher balance, and days after use the reduced balance.

Paying the statement in full before the grace period (often about 21 days after the cycle ends) typically avoids purchase interest. Carrying a balance, or paying later in the month, raises the average daily balance and the charge.

Frequently asked questions

Is credit card interest calculated daily or monthly?
Issuers typically calculate interest daily using APR ÷ 365 and your average daily balance, then charge the total once for the billing cycle.
What does a 20% credit card rate mean?
A 20% APR is divided by 365 for a daily rate, then multiplied by your average daily balance and the days in the cycle. It is not a flat 20% of the balance each month.
How do I avoid credit card interest?
Pay the full statement balance before the grace period ends. If you cannot, paying earlier and more often lowers the average daily balance and reduces interest.
Does a 0% balance-transfer offer change this math?
During a true 0% promotional period, purchase or transfer interest on that balance is zero. After the promo ends, the regular APR applies to whatever remains.
Why might my statement differ slightly?
Issuers use their own cycle dates, may include new purchases, and round according to their agreement. This tool is an educational estimate of the average-daily-balance method.

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