average daily balance

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Average Daily Balance

Definition: The average daily balance is the average amount of money in a financial account over a specific period of time, usually calculated at the end of each day.

Usage Examples:

Noun (finance): In order to determine the interest earnings on your savings account, the bank calculates the average daily balance for each month.
Noun (credit): Many credit card companies use the average daily balance method to calculate interest charges on outstanding balances.
Noun (banking): To avoid fees, it is essential to maintain an average daily balance of a certain amount in your checking account.
Adjective (general): Her average daily balance has been consistently high, allowing her to save a significant amount of money over time.