Understanding how your credit card’s billing cycle works can help you manage your money and prepare for upcoming bills. You may even be able to use this knowledge to make strategic decisions that can give you more time to pay off purchases or improve your credit scores.
Keep reading to learn about what a billing cycle is, how it works, how long it lasts and more.
Key takeaways
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A credit card billing cycle refers to the period of time between two billing statement closing dates—typically lasting from 28 to 31 days.
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When a billing cycle ends, credit card issuers add up all the transactions that occurred during the billing period and carry over any additional balances from the previous billing cycle to provide a credit card statement.
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It’s helpful to understand how your billing cycle works to help you plan for upcoming purchases and make on-time payments.
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What is a billing cycle?
A billing cycle—also called a billing period or a statement period—is the time between two statement closing dates. At the end of a billing cycle, your transactions from the billing period and previous balances are added together to determine your statement balance. The bill for your statement is usually due around three weeks later, although it depends on the credit card company. And the next billing cycle begins right away.
How does a credit card billing cycle work?
A credit card billing cycle is important for determining your credit card bill’s amount and payment due date. Here’s how a billing cycle typically works:
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At the end of each billing cycle, the card issuer will add up all the transactions that occurred during the period.
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It will also add balances that were carried over from the previous billing cycle.
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Then your issuer will send you a credit card statement with a summary of the account activity, statement balance, minimum payment and due date.
Transactions that may be included when calculating your balance include:
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Purchases
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Payments
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Interest charges
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Statement credits
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Fees
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Cash advances
Credit card grace periods
Many credit cards have a grace period—between the end of a billing cycle and the bill’s due date—when you may not be charged interest on your purchases. For example, Capital One’s grace period is at least 25 days. Grace periods are usually between 25 and 55 days. And if you pay your bill in full each month, you won’t be charged credit card interest on your purchases. But if you pay less than the full amount, interest may begin to accrue.
How long is a billing cycle?
While billing cycles may vary, credit cards often have a billing cycle of around 30 days. But a billing cycle isn’t always 30 days—it depends on the card issuer and can range from 28 to 31 days.
You can review your credit card agreement or credit card statement to find how long your card’s billing cycle is. To comply with federal regulations, your card issuer must use equal billing cycles. But there’s a little wiggle room to accommodate weekends, holidays and months that are longer or shorter than others.
Billing cycle example
For example, let’s say your billing cycle ends on the 15th of each month. The card’s billing cycles are considered equal if they end within four days of that date, even if they’re not the exact same number of days.
Can I change my billing cycle?
Your card issuer might be able to change your account’s billing cycle, but you’ll be notified before that happens. While you generally can’t choose the length of your card’s billing cycle, you may be able to request a new due date for your bills. If approved, the change may take one to two billing cycles to go into effect.
If you’re a Capital One credit cardholder, you can request a new due date to give you more control of your finances.
Using your billing cycle to plan for purchases and payments
Understanding how billing cycles, statement balances, grace periods and due dates work can help you make strategic decisions about how and when to use a credit card.
Knowing when a billing cycle comes to an end can help you budget for the upcoming bill. Paying off a credit card in full can help you avoid paying interest. But even when that’s not possible, you can make the minimum payment by the due date to avoid a late fee. If you’re more than 30 days past due, it could hurt your credit scores.
How billing cycles impact your credit
Credit card issuers often send an update to the three major credit bureaus—Equifax®, Experian® and TransUnion®—with your card’s balance after the end of each billing cycle. But the timing can depend on the issuer. The reported balance and credit limit can impact your credit utilization ratio, which is a measure of how much available credit you’re using and an important credit-scoring factor.
Billing cycles in a nutshell
Checking your credit card balance throughout each billing cycle can help you keep an eye on your current balance and prepare for upcoming bills. Capital One customers can use the Capital One Mobile app1 to check balances, pay bills or lock their cards.2 And customers can set up notifications to get real-time spending alerts on the app.
You can also use CreditWise from Capital One to access your TransUnion credit report and VantageScore® 3.0 credit score anytime—without hurting your score. CreditWise is free and available to everyone—even if you’re not a Capital One cardholder.3
