What does Grace Period Mean?

  In all credit card applications and offers they will mention a "grace period" that is usually anywhere from 17 days to 30 days.  When you purchase a product with your credit cards, the grace period is the amount of time until you have to pay interest on the purchase.  So if you buy something and pay it off without the certain amount of days in Grace period going by, you would pay no interest.  You need to pay special attention to this before filling out any credit card applications.

  Obviously, the longer the grace period the better it is.  This is because you have more days to pay off your purchases before you have to start paying interest and this saves you money.  Even if you have no problems paying your bills within a short period of time, I would suggest you pay attention to the grace period when filling out credit card applications.  You never know when one or two extra days will come in handy. 

  I wouldn't personally trade a couple of days in the grace period for a higher APR or if it meant the loss of some other benefit.  But if the credit card applications or offers are otherwise equal, I would definitely take the one with the longer grace period.

  Generally speaking, almost all credit card applications and offers I know of do not have a grace period for cash advances.  These are the times when you use your credit cards to withdrawal money from a bank machine.  Every time you do that, you start paying interest on those transactions right away.  If at all possible, do not use your credit cards for cash advances since it will cost you more money in interest than if you used the card for a purchase instead.

  Make sure you are aware of the number of days the credit card applications you are filling out have for a grace period.  But I would not reject a credit card offer solely because of a short grace period.  Make sure the offer suits you in all your needs and as long as the graces period isn't 7 days or something.  I would go ahead and apply.

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