Finance Globe

U.S. financial and economic topics from several finance writers.
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Why You Should Always Read Your Credit Card Statement

The two most important pieces of information on the credit card statement are the minimum payment amount and the payment due date. We have to know this so we can make payment and avoid the consequences of a late payment. But, your credit card billing statement has a lot of other details that are equally important.

To confirm your transactions

Your credit card statement will include a list of all the transactions made to your account in the most recent billing cycle. Read through each of them to be sure they were transactions you made. Any strange transaction should be reported to your credit card issuer, regardless of the amount. Some small transactions are made by potential fraudsters looking for open, active accounts.

You have 60 days from the date the billing statement was mailed to dispute billing errors in writing to your card issuer’s address for receiving correspondence. While the card issuer is investigating your dispute, you’re not responsible for paying those disputed charges.

To confirm your last payment was applied correctly

We often check our bank accounts to confirm a payment has been processed. But, just because the credit card issuer cashed your check doesn’t mean they assigned to your account correctly. Check your credit card statement to confirm your payment was applied to your account and on the right date.

You should also confirm that payments are correctly applied to balances with different interest rates. If your credit card has balances with different interest rates, for example a balance transfer and a purchase, the minimum payment must be applied to the balance with the highest interest rate. Check your credit card statement to confirm this is the case. Your card issuer may allow you to specify how the remainder of the payment should be applied, but they’ll likely put it toward the balance with the lowest interest rate.

To get details about paying off your account

Credit card issuers are now required to include a minimum payment warning on your credit card statement. The warning lets you know how long it will take to pay off your balance if you make only the minimum payment. It will also let you know the total amount you’d end up paying if you make just the minimum payment. If you’re paying the minimum, make sure you know the impact.

Your credit card statement will also include the payment you’d have to make to pay your balance off in 3 years. That information is useful when you want to get rid of your credit card balance much sooner or if you want to save some money on interest.

To learn of changes to your account

You can learn about a change to your credit limit, interest rate, or fees by looking at your credit card statement. Typically, a summary of the changes will appear on your credit card statement. But, you’ll miss that information if you never read through your entire statement.

To find the address for correspondence

Credit card issuers receive letters at a different place than they receive payments. So, if you need to mail your creditor a letter – perhaps to dispute credit report information or to close your account – make sure you send the letter to the correct address. Otherwise, your letter may not wind up in the right hands. Or, it could take longer to reach the right person. Some creditor letters, like billing error disputes, are time-sensitive so sending to the right place is imperative.

Set aside a time to read through your credit card statement, several days before your due date is best. Reading your billing statement puts you in control of your accounts.
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Tuesday, 20 August 2019

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