What is the advantage of paying your credit card balance in full each month?

Question

A.
You pay only a small amount of interest.

B.
You have less of your credit limit available, therefore, less temptation to spend.

C.
You avoid paying any interest and fees.

D.
You will incur only a small "paid in full" fee on your next credit card statement.

Answer 1

The advantage of paying your credit card balance in full each month is:

C. You avoid paying any interest and fees.

By paying the full balance each month, you can take advantage of the grace period offered by most credit cards, which allows you to avoid interest charges on your purchases. This helps you maintain better financial health and keeps your credit utilization low, which can positively impact your credit score.