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What Is an Outstanding Balance?

Kevin Payne
By: Kevin Payne

Our Personal Finance Expert

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Part of managing your personal finances is handling credit card bills. If you use credit cards regularly, knowing your outstanding balance can help you keep track of how much you owe a credit card company. But what is an outstanding balance? Keep reading to find out what an outstanding balance is and how it affects you.

Outstanding balance definition

An outstanding balance is the amount you owe on any debt that charges interest, like a credit card. Most often, it refers to the amount you owe from purchases and other transactions made with your credit card. It's also called your current balance.

Your outstanding balance is what you currently owe on your card and can include:

Card issuers assign specific credit limits (spending limits) on your cards. Your outstanding balance helps determine how much much credit (money left to spend) you have available. To find out how much you have left, simply subtract your outstanding balance from your credit limit. Don't forget to include any charges that haven't shown up on your credit card account yet. 

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What do I need to know about outstanding balances?

Knowing your outstanding balance gives you a more complete view of your credit card debt. Here's a look at some of the details you should know about outstanding balances. 

How do I find out my outstanding balance on a credit card?

Access your credit card account to find your outstanding balance. Most credit card issuers provide access online and through a mobile app. You can also call the card issuer's customer service phone line to get your outstanding balance. Usually, credit cards list the issuer's customer service phone number on the back of the card.

What is the difference between outstanding balance and remaining balance?

Let's say you spent $500 on your credit card. Then, you log in to your credit card app. It says you have an outstanding balance of $500.

You don't have $500 to pay off that entire outstanding balance -- but you can pay $200. So you send a payment of $200.

You still owe the credit card issuer $300. That $300 is your remaining balance.

Remaining balance and outstanding balance are just two terms used to talk about the amount you owe your credit card issuer. Remaining balance is the amount you still owe after a payment. Outstanding balance is the total amount you owe (which is sometimes the same as your remaining balance).

What is an average outstanding balance?

An average outstanding balance is the amount you owe averaged over a specific time period. For example, the average daily balance on a credit card is the average amount you carry each day of a statement cycle. It's calculated by adding up your balance for each day of a statement cycle and dividing it by the number of days in that period. 

Most credit card issuers calculate the credit card interest you owe daily. This daily interest charge is the called daily periodic rate. Your average daily account balance is the basis of that calculation.

Because interest is added daily, it's a good idea to pay off your balance.

How does an outstanding balance affect my credit score?

Several factors go into determining a credit score. One is your credit utilization. That's the percentage of how much of the available credit you are using. Credit utilization makes up 30% of a FICO® Score

Keeping large credit card balances could lower your credit score even if you're making payments on time. You may scare away creditors if you apply for new credit. They could see you as a risky customer because you're already using a large percentage of your available credit. 

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  • Outstanding balance is the sum of current purchases and other unpaid amounts on your credit card. It includes purchases, cash advances, balance transfers, interest, and additional fees you owe.

  • Average daily balance is the balance credit card issuers use to determine your daily interest charge. Your average daily balance is the sum of your outstanding balance each day of a statement cycle divided by the number of days in that cycle.

  • No, having an outstanding balance doesn't mean it's past due. As you use your credit card during a statement cycle, you add to the outstanding balance. (Past due refers to a bill you didn't pay by its due date.) If you have a past due balance, it's included in your outstanding balance.

  • You can find out your outstanding balance by accessing your account online, through the card issuer's mobile app, or by calling the card's customer service line.

Our Personal Finance Expert