Paying attention to the credit card statement is important. By reviewing your credit card statement, you can keep track of credit card spending, find errors, and make timely payments.
Usually, credit card issuers send a monthly statement at least 21 days before your minimum payment due date.
You will receive a credit card statement in the mailbox every month.
You should review your credit card statement to stay away from potential problems.
Here’s how to understand some major features of your credit card statement:
Credit Card Statement: How to understand
Your credit card statement contains many sections. Here you go:
In the beginning, you will find your account information. You will find the account number, the account opening date, and the dates covered in this statement period.
Just below that, you will find a box named Account Summary. It contains your account details. For example,
- As in your last statement
- Your current balance
- Any credits or fees added to your account
- Interest accumulated by you.
By going through the account summary portion, you can easily understand whether or not your finances are in order.
The payment information contains the details about the payment you need to make. This section helps us to understand how much to pay to avoid late payment penalties.
This section contains:
* Minimum payment and payment due date.
* The consequences of not making payments (the late payment warning disclosure).
* The fact that paying less than the minimum could charge you a late fee.
* If you’re 60 or more days late, the interest rate will increase.
The major credit bureaus (TransUnion, Equifax, and Experian) will be notified about the late payment.
Payment Due Date
You shouldn’t avoid this section in the statement. Know your payment due date to avoid any late or missed payments. Remember, late payment fees and interest are applicable if the due amount is not paid by the due date.
The interest amount is the percentage of your outstanding amount.
The late payment fee will be decided by the credit card issuer, which differs from bank to bank.
The late fee will be applicable once you fail to pay the minimum amount due.
If you don’t make a payment on time, it will be recorded in your credit history.
Credit Counseling Notice
The credit card billing statement contains contact information for a nonprofit credit counseling agency. This is to help credit card users who are facing trouble making credit card payments.
If you didn’t make a credit card payment in a long time, contact a credit counselor for advice.
Notification of any changes to the account
In this section, you will see any changes made to your account.
- Changes in annual fees
- An increased interest rate
- The effective date for these changes.
Usually, the issuer sends an email regarding the changes.
Your credit card statement also contains a payment coupon. You can use this coupon when you’re making a credit card payment. It helps the credit card issuer process your payment correctly. You just need to detach the coupon and place it in the envelope with your credit card payment.
Check your billing statement to see if or not all the transactions and amounts are correct. If incorrect, then report any fraudulent activity or charges to your creditor as soon as possible.
Monthly interest calculation
Usually, the interest is calculated for each type of balance. For example, purchases, balance transfers, and cash advances. Also, you will find the details of the Promotional APRs in this section.
Total interest and fees you have paid
You will also get the total interest and fees you’ve paid in the running year.
If your credit card has reward program benefits, you will find a section about the summary of rewards. This contains your reward balance, rewards earned during this period, and the number of rewards available for redemption.
Lastly, there are many other sections that also require your attention. Usually, most credit card companies follow the same layout. However, there can be some dissimilarities in your statement. Paying attention to the statement has many benefits. Based on your statement, you see an error that is responsible for your poor credit score. You can also avoid missed payments and late payment penalties by checking your statement.
If you are managing your credit cards well, you can negotiate for a lower interest rate. You can also request to increase your credit limit. So, next time, you should pay attention to your credit card statement.