Q: Is it true that most credit card issuers compound interest charges on my
outstanding balance?
A: Most of the top credit card issuers use a daily periodic rate instead
of a monthly periodic rate to calculate interest. This means that
interest is effectively applied to your average balance each day rather
than once per month. It adds about 0.2% to the stated interest rate.
Compound interest is great when you are saving but not when you are
borrowing.
