In a world where very little is ever certain, the one thing we can always rely on are those monthly bills that arrive like clockwork. They’re always there, reminding us that those “must have” shoes are now “must pay for” shoes. There’s far more to that monthly statement, however, than just the balance on your credit card. In fact, your monthly statement holds a wealth of information and when you know how to use, it can become a great tool to use in all of your personal budgeting efforts. While each bank has its own format, the generalities are usually quite consistent and we’ve detailed them below.
The Summary of Account Activity
The summary area is where you can hit the high points of your credit card account as a whole. It usually includes a previous balance, payments made since your last statement was prepared, any credits that were applied, cash advances you may have taken during the month and of course, the total of your credit card transactions.
Most statements also include the interest you were charged during the month as well as any fees associated with your transactions. Finally, you’ll likely notice your new credit limit calculated by your payments and charges, the interest in dollar amounts and the minimum amount due. This is usually the moment of clarity we sometimes have when we realize we either need to rein in our spending habits or we congratulate ourselves for becoming better stewards of our money.
Your Payment Information
You might notice, if you have more than one open credit card, the differences and nuances in both the information that’s included as well as the layout. Some will include important notices, such as late payment penalties, cautions and reminders of the importance of making your payments on time and your late payment date, which is usually the date fees are calculated.
These days, you may notice another notice, usually referred to as a ‘Minimum Payment Warning’. Here, you’re usually afforded a side by side view of how long it will take to pay your current balance when you make only minimum payments as well as when you might expect to pay your current balance when you double your payment or at least pay more than the minimum due. This is a powerful motivator when you can see how many years you’re knocking off by paying more than the minimum. Not only that, but you’ll save a lot of money in interest fees, too.
This is where you will discover your heart beating faster if your bank or credit card company changes interest rates associated with your account. There are any number of ways you can trigger a higher interest rate, including late payments, going over your limit or if a special interest rate was offered for a limited time but has now expired. Often, consumers aren’t even aware of these changes unless they check their statement for something other than the bottom line balance.
Here’s where you’ll find all of the information needed to remind you of why your balance grew over the past thirty or so days. You’ll find the date of a transaction, where the purchase of goods or services was made, the total amount charged and contact information for the one who initiated the transaction. This area is important for another reason, too. Often, consumers aren’t aware their credit card has been stolen or compromised until they see charges they know they did not make on their accounts. Of course, by then, days or even weeks have lapsed; which only reiterates the importance of paying attention to the details of your account.
Finally, your credit card statement will include all the necessary information for contacting the bank. Web addresses, email addresses and phone numbers are usually prominently displayed for customers to inquire about charges or changes to their accounts.
Next time the postman delivers that familiar business sized envelope, remember it holds much more than the total amount due and can be an important tool in your arsenal of maintaining your great credit rating.