1. What is the Credit Card Interest Calculator?

This calculator compares monthly interest charges for up to three different credit cards in Australia based on their Annual Percentage Rates (APR) and your current balance.

2. How Does the Calculator Work?

The calculator uses the simple interest formula:

Where:

• \( P \) — Principal balance (AUD)
• \( R \) — Monthly interest rate (APR / 12, as a decimal)
• \( I \) — Interest charge (AUD)

Explanation: The calculator converts each card's APR to a monthly rate, then calculates how much interest you'd pay per month on your current balance.

3. Importance of Interest Comparison

Details: Comparing credit card interest rates helps you understand which card costs more to carry a balance on, potentially saving you hundreds of dollars per year.

4. Using the Calculator

Tips: Enter your current credit card balance in AUD and the APRs for up to three cards. The calculator will show the monthly interest for each.

5. Frequently Asked Questions (FAQ)

Q1: Why compare monthly interest instead of APR?
A: Monthly interest shows the actual dollar amount you'll pay, making it easier to understand real-world costs.

Q2: What's a typical credit card APR in Australia?
A: As of 2023, standard rates range from 12-24%, with some premium cards higher.

Q3: Does this include compounding interest?
A: This shows simple monthly interest. Actual costs may be higher with daily compounding.

Q4: How can I reduce my credit card interest?
A: Pay balances in full each month, transfer to lower-rate cards, or negotiate with your provider.

Q5: Are there other fees not included here?
A: Yes, annual fees, late fees, and cash advance fees aren't included in this calculation.