When you use a credit card, a lender loans you money until you repay the amount back. During this time when you borrow money, you will be charged interest on the total amount you borrowed after any initial interest free periods.

This is when you pay credit card interest, the amount of interest charged varies between lenders based on the credit cards interest rate. A lower interest rate is a better option when you leave a balance on your credit card continuously.

They’re generally two types of credit card interest rates, purchase rate and cash advance rate.

Purchase rate is charged when you buy anything on a credit card, like when you use your credit card in the shops or online.

Cash advance rate is charged when you draw cash directly from your credit card. Cash advances usually have a higher interest rate and are not recommended for most credit cards, you need to check your credit cards cash advance rate if you need to use it. Also note the terms of cash advances, they usually stop any interest free periods until you repay your card in full.  Something to watch out for!

The Interest rate charged is calculated using a compound interest formula. What compound interest does is add interest to the principle daily. Every day your balance owing grows because of this interest added. If you repay more than minimum repayments, then you can greatly reduce the compound interest effect on your debt.

If you don’t want to be paying too much Interest for using a credit card, it makes sense to use a low interest rate credit card when you know you’ll be paying interest. Compare low interest credit cards for Australian’s online before you make and application, you can choose a credit card with the least interest and save heaps of money in the long run.

credit card interest calculator

Credit Card Interest Calculator

Do you know how much interest you are paying on your current credit card balance? To find out, use our  credit card interest calculator to see what compound interest you are being charged daily, weekly, monthly and yearly with the money you owe.

Citibank introduces the Citibank Clear Platinum Credit Card for Australian consumers who want a low interest rate on purchases along with the option to pay the account in full each month without interest or penalty.

The Citibank Clear Platinum Credit Card is perfect if you prefer not to carry a balance from month to month, offering up to 55 interest free days as long as you pay the entire monthly balance by the due date.

But should you chose to carry a balance, you are covered by a low interest rate of only 11.99%, one of the lowest annual percentage rates available on a credit card today. And when you apply for your Citibank Clear Platinum Credit Card, be sure to transfer your higher interest balances to your new Citibank Clear Platinum Credit Card to take full advantage of the 0% APR for six months on all balance transfers.

A prestige credit card especially suited for travel, the Citibank Clear Platinum Credit Card offers free Transit Accident Insurance and free International Travel Insurance of $500,000 to cover any unexpected travel or medical expenses, personal liability, losses and damage to possessions for you, your spouse and your dependent children.

Citibank’s Visa Concierge Service is available to Australian cardholders around the clock and world wide to book theater tickets, make dinner reservations, even arrange a personal getaway while you get on with your day, letting Concierge do the work. VISA Platinum Privileges will get you a table at the trendiest restaurant, invitations to gallery and exhibition openings, book your tickets for sold out events, even provide you with backstage passes.

And Citibank World Privileges entitles you to up to 25% in discounts around the world on hotels, restaurants, entertainment and shopping. With the Citibank Clear Platinum Credit Card, these rewards are all available to Australian consumers immediately.

Citibank also provides you with Emergency Travel Assistance service and Emergency Card Replacement service, giving you additional security and protection while you travel. And Purchase Cover repairs or replaces any lost, damaged or stolen purchases for three months. You even get Extended Warranty on all your purchases.

With the free Fraudshield service, Citibank monitors your account and, in the event of any irregular activity, notifies you immediately by phone anywhere in the world, further ensuring your security and peace of mind.

Citibank Clear Platinum Credit Card also gives you the option of CreditShield to cover your minimum monthly payments should you become ill, unemployed or unable to work due to accident. Moreover, CreditShield will pay up to $30,000 of your outstanding balance in the event of disablement or death.

The Citibank Clear Platinum Credit Card has you covered on every front with a credit line of up to $60,000 and a low annual fee of just $85. To qualify for this exceptional card you will need excellent credit and an income of at least $50,000 per year. Apply online and receive confirmation of your application within minutes. Citibank looks forward to making your life easier, happier and more fun with the Citibank Clear Platinum Credit Card.

Credit card debt in Australia has risen dramatically over the last 10 years; a lot of people have accumulated a credit card debt through lifestyle choices. If you are not careful about your spending habits you could find yourself in real financial trouble. If you can’t repay your credit card debt every month then you should get it as low as possible until you can. So if you use your credit card regularly then you should make regular repayments and stay on top of the money you owe.

Plan all credit card Expenses

Credit cards are a useful payment facility; you can organize payments of all sorts of things through a credit card like power bills, phone bills, groceries etc.. the list can go on. It is very convenient for people to setup their credit cards to handle bills; this also has the benefit of tracking bills through your credit card statements.

If you have a credit card setup this way or are planning to use credit cards for similar purposes, a simple budget and repayment plan should be used to manage your money and keep things from getting to difficult. So knowing what will be charged to your credit card is a must and will help you budget a repayment plan.

Know your weekly Spend?

With all these different bills coming out of your credit card, you need to know on average how much you are spending weekly. Because some bills are only monthly, bimonthly quarterly, half yearly or even yearly, you will need to add up there costs over a period of time (month) and divide that total over the number of weeks.

Example

Write out a chart of all the bills you are expecting to charge to your credit card, anything that goes on your credit card should be in this list.

List the name of the bill, the period it’s being charged in months and the amount charged.

You want to know what you will spend on each item over the month in the end. Interest charge on your credit card debt needs to be included, even the fees should be added to get better result.

Divide the amount by the month period of on every bill to get your average monthly spend.

To discover what the average weekly spend will be, you divide the average monthly spend by 4.

$388.33/ 4 weeks = $97.08 weekly spend.

This weekly spend is important to know especially if you already have a credit card debt. This is the amount you have to pay every week just to keep your credit card balance from growing any further.

Stay on top of your repayments

The best way to stay on top of your repayments is to make regular repayments. Now you know how much your credit card is being charged weekly on average, you can set aside part of your income to repay your credit card that amount. The effect of this is that you will not get a surprise when you receive your credit card statements and the balance will more or less be around the same level you started with, ready to begin a debt repayment plan.

Reduce your credit card debt

Get the interest rate monkey off your back. You know what to expect from your credit card on a weekly basis, if you keep up these weekly expenses you can now focus on the remaining debt. From your income, discover what you are able to use to repay the remaining credit card balance. This doesn’t have to be a large amount, but anything else you can put aside for your credit card will help reduce the debt balance. The more you repay on top of average weekly expenses the sooner you will be out of debt.

This budget plan is designed for people with a credit card debt already, yet is very simple and useful for new credit card consumers to use, I you plan your credit card repayments by your average weekly spend and get into a habit of making regular weekly repayments; your whole credit card experience will be a good one. Let debt levels build up before you take action is usually a recipe for disaster and a bad credit rating.

If you have anything to add or would like to point out other ways to budget a repayment plan, please leave a comment.