Some credit cards give you an interest-free grace period. That means when you pay your full balance, you incur no finance charges that month.

On the other hand, when you carry a balance to the next billing period, you’ll pay interest based on your daily balance from the original purchase date. Unlike purchases, when you get cash from an ATM or teller, interest is charged from the date you take the cash to the date it is repaid in full.

A grace period is NOT a few days past your due date when your payment will be considered on time. If your payment is received even one day past the due date, it’s late. That means late fees and a blemish on your credit rating.