Grace Periods: A Guide to Avoid Paying Interest

Grace periods are between the purchase and final payment of an item where you do not have to pay any interest. It is usually around 20-30 days after your purchase. In most cases, companies will advertise this in their promotional materials. It’s so that consumers know how long they have to receive their item, make a payment, and avoid paying interest. However, suppose you’re going to purchase a significant thing. In that case, it’s a good idea to know the grace period for that specific company.

How to Use Grace Period to Avoid Paying Interest

It’s important to note that grace periods are only available on purchases made with credit cards, not debit (or check) cards. Also, credit card companies reserve the right to change this period at will. So be sure to check the terms and conditions of your credit card account for any information about grace periods. Finally, depending on your state laws, you may still accrue interest during this time. That is why it is best to pay off as much of your balance before the expiration date as possible so that you’re not paying thousands of dollars in extra interest charges. That’s where managers and salespeople at stores come in.

If you’re working on commission, it is best to follow up with your customer after purchasing their item and remind them about their grace period to pay on time. So you don’t lose out on a sale. You may also want to encourage them to apply for a credit card with a low-interest rate. Here are some tips for following up with customers who have purchased expensive items:

1. Call up the customer 2-3 days after making the purchase. Be sure not to call too early, as that might dissuade them from paying within their grace period. Conversely, be sure not to call too late, as they might already be in their grace period.

2. Remind the customer that they have 20-30 days to pay for their item without paying any interest. If it has been more than three days, remind them how many days are remaining until their payment is due (20-30).

3. Offer your help by encouraging them to apply for a credit card with lower interest rates or offer suggestions on specific cards to apply for based on the type of product purchased.

Top 3 Grace Period Tips

To avoid paying unnecessary interest fees, here are a few tips you can try:

1. Know how long the grace period is for your credit card. Check the terms and conditions on your credit card statement or log in to your online account to find out.

2. Aim to pay off as much of your balance before this period ends so that you’re not paying interest charges on it. You can do this by using our free debt calculator.

3. Pay attention to when payments are due, not just when they are automatically withdrawn from your checking account. The grace period begins after billing cycles, not at the date payments are automatically drafted, so be sure to check when these dates are to make the most of them!

According to the experts at SoFi, “In most cases, a balance being carried over month to month on a credit card will trigger interest charges, which is essentially the cost of borrowing money from a credit card company.” To learn more about how do you avoid paying interest on a credit card, give them a call.

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