You should pay off your 0% interest credit card before the promotional APR period ends to avoid interest charges. It is best to pay off the balance in increments to ensure on-time payments and to avoid a long period of high utilization – especially if you have a large balance on the card compared to its limit. Cardholders with 0% APR credit cards are still responsible for making on-time minimum monthly payments until the balance is paid in full.
While you can pay just the minimum payment every month to keep the account in good standing, that doesn’t necessarily mean you should. If you leave a big balance on a credit card for a long time, your credit score can go down - even if you’re not paying any interest. So the earlier you pay down the principal balance, the better.
Moreover, if you wait until the last minute of your 0% APR period to pay off a credit card, you may end up not being able to pay everything off before interest starts accruing. The average 0% APR period on a credit card lasts 11 months. And even if you make a big purchase knowing you’ll be able to afford it in full within 11 months, lots of things can happen in that period of time. You may use that money for something else, and end up not being able to pay off the credit card balance in time. The average regular interest rate for a 0% interest credit card is high - around 19% - so ideally, you don’t want any balance subject to the regular interest rate.
Overall, it’s true that 0% interest credit cards are good for financing large purchases without the extra price tag of interest charges. But you will benefit from using a credit card payoff calculator. That way, you’ll know how much you need to pay every month to have a manageable final payment at the end of the intro period.
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