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Grace Period

Definition: Grace Period

A grace period is the period from the date a statement was prepared by the issuer (statement date) to the payment-due date. No interest will be charged if the whole balance is paid by the end of the period. These interest-free grace periods typically last 25 days, but 20-day periods are becoming more common.

When you're looking for a credit card, avoid cards that don't offer a grace period, because you'll end up paying interest immediately upon purchase. It pays to search for a card with a longer grace period, because the amount of time you have interest-free affects how much interest you'll end up paying overall.

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Join The Conversation
thelorax thelorax 8 years
I had a roommate who scheduled all of her bill payments according to grace periods, and even applied for two extensions on her annual income tax filing! She drove me crazy...I had to clarify to her that our rent did not have a grace period!
ilanac13 ilanac13 8 years
oh - i had to add this - i just went online to pay my amex bill - and i found out that since i made a partial payment yesterday - i have a 30 grace period to pay the rest - isn't that interesting? i never knew that and i was going to freak out about it for a few minutes since it wouldn't let me pay the rest by today when it's due.
ilanac13 ilanac13 8 years
i agree - if there's a card that doesn't have a grace period - well i think that says something for what you're paying otherwise in interest or what have you. i think that in many cases people need the time to figure out their budget - and well, like dienliv said - sometimes it depends on when you get your paycheck and what other bills are do (i.e. insurance, rent/mortgage/car payment/utilities).
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