Our experts answer readers' credit card questions and write unbiased product reviews (here's how we assess credit cards). In some cases, we receive a commission from our partners; however, our opinions are our own. Terms apply to offers listed on this page.
- When you check your credit card balance, you're looking at two different balances.
- You can check your credit card balance over the phone, online, or mobile app.
- Keep a close eye on your credit card balances to avoid overspending.
What Is Statement Balance?
The statement balance is the total amount you owed on your credit card at the end of the last credit card billing cycle. This includes all purchases, cash advances, fees, and interest charges accrued during that period. It remains constant until the end of the next billing cycle. Paying the statement balance in full by the due date is crucial to avoid interest charges on your purchases, and can help impact your credit score by showing responsible credit management.
What Is Current Balance?
The current balance reflects the real-time total amount you owe on your credit card, including all transactions made since your last statement was issued. It changes daily based on your recent purchases, payments, refunds, and any additional charges like interest or fees. Understanding your current balance is vital for keeping track of your spending, budgeting effectively, and making sure you don't exceed your credit limit.
Differences Between Statement Balance and Current Balance
Timing and Calculation
The timing of the calculation is a primary difference, with the statement balance being a snapshot at the end of the billing cycle and the current balance being dynamic, reflecting transactions up to the current day.
Impact on Credit Utilization
While both balances can affect your credit utilization ratio, paying attention to your statement balance is particularly important for credit reporting purposes. Keeping your statement balance low can demonstrate good credit utilization and management skills.
Which Balance Should You Pay?
Deciding whether to pay the statement balance or the current balance depends on your financial goals and situation. Paying the statement balance by the due date helps avoid interest and can improve your credit score by showing timely payments. Paying the current balance can further reduce your credit utilization ratio, potentially leading to a higher credit score, but requires more diligent tracking of your account.
FAQs
Can paying off my current balance affect my credit score?
Yes, paying off your current balance can affect your credit score and lower your credit utilization ratio, which is beneficial for your credit score. However, credit bureaus typically use the statement balance to calculate credit utilization.
Why is my current balance higher than my statement balance?
Your current balance may be higher due to transactions, fees, or interest charges that have occurred after your last statement period ended.
What happens if I only pay the statement balance?
Paying the statement balance in full by the due date helps you avoid interest charges on purchases made during that billing cycle but does not waive interest on new or carried-over balances.
Is it better to pay the statement balance or current balance to avoid interest?
Paying the statement balance in full by the due date is sufficient to avoid interest on purchases. Paying the current balance can prevent interest on recent transactions not included in the statement balance.
How often should I check my current balance?
Regularly monitoring your current balance is essential for managing your spending, avoiding overdrafts, and keeping track of any fraudulent transactions.
Cheryl Lock is a personal-finance writer whose work has appeared in Woman's Day and Parents as well as online at USA Today, Forbes, and MarketWatch. She lives in Denver with her husband and two daughters. Follow her on Twitter at @CMLock42 and on LinkedIn.
Top Offers From Our Partners
Capital One 360 Performance Savings Annual Percentage Yield (APY): 4.35% Minimum Deposit Amount: $0
Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards.
Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.
**Enrollment required.
