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Statement Balance vs. Current Balance: What's the Difference?

Your statement balance is a fixed number, while your current balance likely fluctuates.

A senior woman is sitting at a table paying her credit card bill on her computer.

Credit card bills contain a flurry of unfamiliar terms, but two are vital to understand: statement balance and current balance. Essentially, your statement balance refers to the amount you owe at the end of your last billing cycle, and your current balance is the total balance on your credit card as of today. To make sure you know what you must pay, let's dive in a little deeper. 

What is a statement balance?

Your credit card's statement balance includes all the transactions and payments made during one billing cycle. Each credit card has a billing cycle that typically lasts between 28 and 30 days. Billing cycles vary from issuer to issuer, so don't be too quick to assume that your billing cycle starts on the first of the month and ends 30 or so days later. Your credit card statement will state the exact timeframe for each billing cycle.

When your billing cycle concludes, your credit card bill -- including your statement balance -- is generated. The statement balance is a single number that includes all charges you made during the billing cycle, in addition to any unpaid balances that were already on the card (including interest charges, fees and balance transfers). You typically have a grace period of around three weeks before your statement balance is due. You can make the minimum payment to satiate the due date, but any leftover balance will accrue interest. Paying the full statement balance on time is the only way to avoid credit card debt.

What does current balance mean?

The current balance on a credit card reflects all charges, interest, credits and payments on your account to date. Your current balance is a real-time view of what you owe on your credit card. You'd need to pay off this full amount if you wanted to eliminate your debt or close your credit card account. Your current balance updates every time you swipe your card. 

Why are your statement balance and current balance different? 

If you use your credit card often, the odds are your statement balance and your current balance are different amounts. Once your billing cycle ends, your statement balance does not fluctuate until the end of your next billing cycle. If you made a big purchase yesterday, that amount may not show up on your statement balance until next month. 

For example, if your billing cycle falls between the first and 28th of the month and you spent $800, your statement balance on the 28th will be $800. However, if you go out and spend an additional $200 on the 29th, your statement balance will still be $800, and your current balance will be $1,000. Think of your statement balance as a fixed number while your current balance is not, because it's continuously updating according to how often you swipe your card. 

How do your balances impact your credit score?

A healthy credit history involves responsibly managing your credit -- which includes paying off your credit card bill on time every month. Paying off your statement balance every month can also help you avoid paying interest and keep your credit utilization in check. Your credit utilization is the ratio of how much of your total credit limits you use, and represents a large portion of your credit score. If you can't manage to pay your statement balance off in full, it's important to make at least the minimum payment to preserve your credit.

The bottom line

Understanding the difference between your current balance and statement balance can help you better manage your credit card debt, build a strong credit score and effectively pay your bill to avoid interest. 

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