Credit cards changed our spending habits and money managing techniques forever. If you are good at planning your finances, you understand the importance of a credit card statement. It is a monthly statement of your credit card, including transaction history, due payments, due date, etc. Your credit card statement doesn’t leave a single transaction out of records.

We will take you through the details which you need to check in your card statement. We will also explain its importance.

Terms to Understand in a Credit Card Statement

• Credit Limit

  Your credit card issuer considers various factors like your annual income and credit history to fix your credit limit. You can spend through your credit card under your credit limit only every month.

• Payment Due Date

  The whole month you can do any number of transactions within your credit limit. You need to pay that amount on a particular date of the month. The payment due date is the last date of the settlement.

• Minimum Due Amount

  Suppose if you can’t pay your total due amount on your due date, you can save yourself from a penalty by paying the minimum due amount. But you will need to pay interest on the rest of the amount. Generally, the minimum due amount is 5% of your total due amount.

• Billing Cycle

  A billing cycle mentioned in your credit card statement is the time span between the two credit card bills. It can vary from 20 days to 45 days, depending on the policy of your credit card issuer.

• Current Outstanding Balance

  It is the total amount of credit that you owe to the credit card company in your current billing cycle. Your current outstanding balance starts to add up at the beginning of the billing cycle, and it is generated at the end of the billing cycle.

• Rewards & Rebates

  Credit card companies introduce different kinds of rewards and rebates for their cardholders. It is done through tie-ups with various brands and online shopping sites. You can check yours in a dedicated corner of the card statement.

• Transaction History

  The primary purpose behind getting a credit card statement is to check the transaction history. You can check every transaction done by your credit card, no matter how small or big it is. You can raise the doubt with the card issuer company if there is any discrepancy in your transactions.

Importance of Credit Card Statement

• Tax Benefits

  It would be best to do maximum expenses through your credit card, especially the ones for business and charity. Then, you can present your credit card statement as a supporting document for tax benefits at the time of filing tax.

• Transparency

  As you can see, there is everything in your card statement that you need to know as a cardholder. You can point out any false transaction, error regarding due date, or due amount. It gives the power of information to you.

• Due Date Reminder

  Your statement reminds you of your payment due date. It is essential to settle your credit card bill on the due date to avoid paying late fees and extra interest. In addition, your credit history gets dented if you pay your bill after the due date.

• Better Budgeting

  The importance of a credit card statement is beyond keeping the records. You can track down various avenues of your expenses from your card statement. You can also zero down on unnecessary spending and keep a tab on them.

• Credit Limit Alerts

  Your credit card statement also reminds you of your credit limit. This helps you to plan your future expenses. Otherwise, you might exhaust your credit limit on other expenses before spending on something more essential for you.

Impact of Card Statement on Your Credit Score

You understand the importance of a credit card statement more clearly when you get hold of any faulty or dubious transaction. It can be a case of error from the card holder’s side or identity theft. You can catch it by checking your statement.

Your statement also shows your due date of payment. By paying your bills on time and correcting the false transactions, you can keep your credit score maintained.

Bottom Line!

We hope that after knowing what to check in your card statement and the importance of a credit card statement, you will go through it regularly.