Question

How to calculate the average daily balance for the month. Just need help with explaining it to me.

Answer 1

The question is as I had asked above.
Dates are Dec. 15, Dec 23, and Dec 24. The previous balance is 719.04 as of Dec. 13. Annual precentage Rate is 18%...purhcases are as follows: 84.99, 55.99, 35.18,<(on Dec. 15th) 20.99<(on Dec. 23) and 100.00cr<(on dec 24) the Billing Date is Jan. 31. ... needing all the help I could get on this problem. Just walk me through it would be find too.

Answer 2

I just looked at a checking account statement and saw "average balance" and "average collected balance." I don't know how that is calculated and can't help.

However, for "average daily balance" for a credit card, I found an online calculator that may help.

"...the daily average balance is defined as the average of your balance during the billing cycle. To calculate the credit card average daily balance, you simply take the total balance at the end of each day of the billing cycle, then divide by the number of days."

Once you enter the number of days in the billing cycle, the slots for entering the "days" appear. I have not tried it but hope it helps.

http://calculatecreditcard.com/average-daily-balance-calculator/

Answer 3

Thanks so much will give it a try.

Answer 4

Let me know how it goes. I am now curious about these terms. Thanks for asking the question.

Answer 5

The calculator did work...Thanks so much for showing it to me. Now that I know the average daily balance. What are my chances of getting help finding the Finance Charge? for balance of $475.30?

Answer 6

Annual precentage rate is 18%....do I take the balance and times it by the 18% to get my finance charge?

Answer 7

I was just reading about this average daily balance method of charging interest and wondering why it is necessary. Supposedly, it saves the consumer money. Right, like I believe that. :)

Answer 8

It honestly does not save the consumer any money, just puts them in further in debt.

Answer 9

To your second question, I'd like to think that it is that simple. Try it and see what number you get. You shouldn't be charged interest on items you purchased in the most recent billing cycle. The interest shoud be on the balance carried forward.

I'll look for a calculator or explanation although it may be later today. I'll "fan" you so that I can locate the question.

Speaking of credit cards, I was for some reason sending money to an overseas friend who was in a financial jam. Well, I used Western Union, and the interest on that "cash advance" increased every day. Plus, there were Western Union fees. Beware that option. :)

Answer 10

Just saw this:
http://www.free-online-calculator-use.com/credit-card-finance-charge-calculator.html

The calculator is toward the bottom of the page.

Answer 11

yes, I will be very aware....Thank you so much again. I will give it a try.

Answer 12

How to Calculate a Finance Charge on a Credit Card

Read more: http://www.livestrong.com/article/50406-calculate-finance-charge-credit-card/#ixzz1mp9oeDbB

Step 1
Look at your last statement and note your current balance. Your current balance includes your last payment and any new charges plus finance charges.
Step 2
Find the annual interest rate on your statement and write it down.
Step 3
Take the annual interest rate and divide it by 12. This number will be your monthly interest rate. For example, 10.5% APR is .00875% interest per month.
Step 4
Multiply the monthly interest rate by your current balance. If you plan to make a payment make sure to subtract that amount before calculating the interest. For example, my current balance is $500, and I plan to pay $100 this month therefore I will be charged interest on $400. $400 X .00875% = $3.50 in finance charges.
Step 5
Add the finance charge to the current balance. This will be an estimate of your next bill. $400 + $3.50 = $403.50.

Read more: http://www.livestrong.com/article/50406-calculate-finance-charge-credit-card/#ixzz1mp9Lzj3E

Answer 13

Awesome Thanks Directrix....I greatly appreciated all your help. Take care until we meet again.