Whether your credit card statement comes via email or the old-fashioned way, reading and understanding it is pretty important. Here are a few reasons not to instantly delete it or just toss it into the "junk" pile.
Reading your credit card statement every month should be a part of your regular routine. It may not be the most exciting task on your to-do list, but there are a few reasons why it’s important.
When you read the statement, you can also calculate your credit utilization rate for that account, which shows how much credit you’re currently using compared to the total credit limit. The credit utilization ratio can make up 30% of your credit score and is an important factor in establishing good credit. The ideal credit utilization ratio should be around 10%. Too little, and your credit score can also be negatively impacted.
All credit card statements generally look the same, but the exact order of information may vary from issuer to issuer. In general, the monthly statements will show the following:
Account summary: The summary portion will show the previous balance, current balance, previous payments, minimum payment, credit limit and available credit. It may also show any fees and interest charges on balances carried over from month to month.
Credits: This portion will show any money that has been credited back to your account, like a store refund or a disputed charge.
Transactions: The most substantial portion of the credit card statement is the list of transactions. Each transaction will show the vendor, amount and date posted. Many statements also included credits within the transaction section. Oftentimes, these are clearly listed separately.
To see your statements online at any time, first register for account access. You can check your transactions before your statement is even posted. Reviewing your transactions more frequently can make it easier to track spending or resolve fraudulent charges, for example, than if you wait to do it at the end of the month.
If you notice a mistake or have a question about your account, you can contact the credit card company directly. Contact information is usually listed on the paper statement and can also be found in your online account.
Some card issuers also have a message center or chat feature you can use to help manage your account without waiting on the phone.
Going over your credit card statement each month, or more often, has a range of benefits and is an important part of good money management habits.
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