APR (annual percentage rate)

The yearly cost of borrowing money, shown as a percentage.

APR is the yearly rate you pay to borrow. On a credit card, the APR is the interest rate. On loans like mortgages and car loans, it also includes certain fees, which makes it easier to compare offers.

Interest isn't charged once a year. Credit cards usually charge it daily, at about 1/365 of the APR, on your balance. A card with a 24% APR costs roughly 2% of the balance each month you carry it.

If you pay your full statement balance by the due date, most cards charge no interest on purchases at all, whatever the APR. APR matters when you carry a balance.