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Your statement balance is the amount you owe on your credit card as of the latest billing cycle. Your current balance refers to all unpaid charges on an account, up to the date of your inquiry. The two are often different, especially if you use your credit card every day.
As a cardholder, you are responsible for paying your statement balance or a portion of it, to avoid any negative consequences.
Paying your statement balance vs. your current balance
Regular purchases: If you want to avoid interest from regular purchases, you need to pay off your statement balance. You card's purchase APR is applied toward any unpaid portions of your statement balance only. While you may have a current balance above $0, you won't be on the hook to pay interest on it so long as your statement is paid off in full.
However, if you want to be diligent about your finances, it's best to always pay your entire balance — that means your current balance. By keeping your current balance at, or near, zero, you keep your credit line open for additional purchases.
Cash advances: If you take out a cash advance, you will need to pay the current balance as soon as possible to avoid any charges from accumulating. If you pay just your statement balance, you will end up having to pay interest on that cash advance. Any minimum payment you make is applied toward the balance with the lowest APR first. Cash advances typically have a higher interest rate, so you would not make any dent in that balance.
Any payments in excess of the minimum are applied toward the highest APR balance, though only on transactions that have been closed out on a given statement. Thus, if the cash advance is not on your statement balance, you won't erase any part of it unless you pay the entire bill.
The reason cash advances throw a wrench in the statement/current balance topic is that they don't have a grace period, which we explain in more detail in the following section.
How to find your statement balance and current balance
When you log in to your account, your issuer will usually display your statement balance and current balance on the main page.
In the screenshot below, the left side shows a statement balance of $0. This means that no charges were added to the card in the previous billing cycle, so no payment is owed. The right side (labeled "Total Balance") shows a current balance of $257.46. Since the statement hasn't closed yet for this amount, no payment will be owed on it until the end of the next billing cycle.
How is your statement balance determined?
Your statement balance is made up of transactions that occurred during the last billing cycle, as well as any previous unpaid balances. The length, in days, of the cycle varies from bank to bank. Some last 20 days, while others may span 45. The CARD Act of 2009, dictates that you have, by law, at least 21 days to pay your statement balance from the day your company delivers you the bill. Some credit card companies may extend that by a few days.
This period is usually referred to as a grace period, and no interest charges will be charged to the account so long as the statement balance is paid in full by that time.
Cash advances have no grace period, meaning they begin accruing interest immediately from the moment the transaction happens. Normally, consumers only need to worry about interest charges on any statement balance left unpaid past a grace period. Cash advances are unique in this regard, which is why you should pay your entire current balance as soon as possible after you make a cash advance (or avoid cash advances altogether).
Impacts to your credit score
Both your statement balance and your current balance can impact your credit score, though, in most cases, you only need to worry about your statement balance.
Every month, card issuers report their customers' outstanding debt to the credit reporting agencies. This information is then used in many credit scoring models to assess your creditworthiness. Though many credit scoring models exist, the most popular one is FICO 8. In this model, utilization accounts for as much as 35% of your entire score. Most of the largest card issuers in America — including Chase, Citibank and Bank of America — report your statement balance and not your current balance.
If you want to keep your utilization low, you should prioritize keeping your statement balance low. To do this, make payments to your credit card bill throughout the month. Check with your credit card issuer to know exactly when your balance is reported. This will allow you to plan around that date.
Consumers should generally not put too much emphasis on utilization, as the effects on your credit score are minimal unless you begin going over 50% utilization. For FICO Scores, consumers should try to keep their utilization below 30%. However, going slightly over that figure won't have a huge negative effect on most people's credit scores.