What Is a Credit Card Balance?

Your credit card balance is the total amount of money you owe your credit card company. However, understanding your card’s different balances might be a bit confusing at first. You may see “previous balance” and “new balance” when reading your credit card statement. You might even see “current balance” if you’re checking your credit card account online.

Knowing which balance you’re responsible for paying each billing cycle can help you pay less in credit card interest and avoid late fees and other penalties.

Key Takeaways

  • Pay off the full statement balance by the due date each month to avoid paying interest on your charges.
  • Avoid late fees and other penalties by always paying at least the minimum payment by the due date.
  • Keep tabs on your credit card balance by regularly checking your online account or closely checking your credit card statement each month.

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Statement Balance vs. Current Balance: What’s the Difference?

Whether you check your credit card bill online or wait for a credit card statement to arrive in the mail, you are likely to see a few “balances” listed. Here’s a breakdown of the most common balances:

Statement Balance

Your statement balance—also sometimes called your “new balance”—is like a snapshot of your credit card balance at the end of a billing cycle. A statement balance tells you how much you owe at the end of one billing cycle, which is typically 20-45 days. It’s the total of all your purchases, fees, interest and unpaid balances, minus any payments or credits.

Current Balance

While the statement balance is a snapshot of your balance at the end of a billing cycle, the current balance is a snapshot of the total amount you owe at the time you check it. Like your statement balance, your current balance is the total of all your purchases, fees, interest and unpaid balances, minus any payments or credits.

Credit Card Minimum Payments

The minimum payment is the amount that you have to pay by the due date to keep your account in good standing and avoid negatively impacting your payment history. You can make a minimum payment or pay something between the minimum and full statement balance. When you do this, the remainder of your statement balance gets carried or “rolled over” to the next statement. And you’ll typically be charged interest on that balance.

Is It OK to Carry a Credit Card Balance?

Carrying a balance may be a necessity if you can’t afford to pay your bill in full each month. But regularly carrying a balance can be costly. If you have a revolving balance, your purchases can start quickly accruing interest.

You should always pay as much of your full statement balance as you can, the Consumer Financial Protection Bureau (CFPB) explains.

Doing this can help you cover the interest charged while also decreasing the total balance on your card. This all helps you pay off your debt more quickly.

Paying as much of your balance as you can also helps limit the interest you’ll owe over time. And the less interest you’re charged, the lower your future card payments could be, too.

Does a Credit Card Balance Affect Your Credit Scores?

Carrying a credit card balance isn’t just costly. It can affect your credit scores, too.

Credit card issuers typically report your balance information to the credit bureaus after each billing cycle. But the exact timing can be different for each issuer. And because your credit reports show the balance on your card when the issuer reported the information, the amount might be different from your most recent statement balance.

Also, credit-scoring companies use your credit utilization ratio when calculating your credit scores. And your credit card balance at the time it’s reported to the bureaus can impact this.

Your credit utilization ratio measures how much credit you’re using compared to the amount you have available. According to the CFPB, experts recommend keeping your credit utilization below 30% of your total available credit. 

If you use your card a lot and can afford to make a monthly payment early, paying down your current balance—while not always required—can help reduce your credit utilization ratio. And that in turn can help improve your scores.

How to Check Your Credit Card Balance

It’s always important to keep an eye on your credit card balance. And there are a variety of ways you can check your balance. You could:

  • Use your lender's mobile app.
  • Sign in to your online account.
  • Review your paper statements.

If you try those options and still have trouble checking your balance, you could try contacting your credit card issuer.

Credit Card Balances in a Nutshell

Understanding and checking your credit card balances can be an important part of managing your finances. It’s a good idea to check your balance regularly, so you’ll know how much available credit you have and can prepare for the bill that will be coming soon.

You can also monitor your credit to see how your most recently reported balance impacts your scores. CreditWise from Capital One is a free tool that lets you monitor your VantageScore® 3.0 credit score. Using CreditWise to keep an eye on your credit won’t hurt your score. And it’s free for everyone—not just Capital One cardholders.

We hope you found this helpful. Our content is not intended to provide legal, investment or financial advice or to indicate that a particular Capital One product or service is available or right for you. For specific advice about your unique circumstances, consider talking with a qualified professional.

Capital One does not provide, endorse or guarantee any third-party product, service, information, or recommendation listed above. The third parties listed are solely responsible for their products and services, and all trademarks listed are the property of their respective owners.

Your CreditWise score is calculated using the TransUnion® VantageScore® 3.0 model, which is one of many credit scoring models. It may not be the same model your lender uses, but it can be one accurate measure of your credit health. The availability of the CreditWise tool depends on our ability to obtain your credit history from TransUnion. Some monitoring and alerts may not be available to you if the information you enter at enrollment does not match the information in your credit file at (or you do not have a file at) one or more consumer reporting agencies.

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