Is that an unfamiliar term? If you carry a balance, it’s one you need to be aware of, even though you won’t notice it until you finally pay off your credit card.

A residual finance charge is how interest is charged on your credit card by many companies. Even before you get your statement, you are getting charged on your balance if you did not pay it off the previous month. This means that if you pay off your credit card this month, you will still see a finance charge on your next statement. This charge is the interest that accrued from the end of your previous billing cycle until your payment was received.

You don’t want to miss this one – if you think you just finished paying off your credit cards, double check just to be sure.

Technorati Tags: ,