Most cards offer grace periods to customers who pay off their balances each month. A grace period is the period from the statement date to the payment-due date. If payment is made in full by the end of the grace period, no interest is charged. But if only a partial payment is made, interest kicks in at the end of the grace period.

Many issuers have whittled down the interest-free grace periods on credit cards from 25 days to 20. Some credit cards have no grace periods whatsoever. Avoid them.