Understanding Your Credit Card Statement

by : marsel

Whenever you get your credit card billing statement in the mail, do you understand what is written on it? It actually is not enough to know how much you are going to pay for that month. It also is important for you to know when you should make your payments. Here is a short dissection on your credit card statement, to help you better understand what you receive and how you may go about managing your finances.

First is your APR. The APR stands for annual percentage rate. This is what you pay every year, and the amount may depend on the remaining balance that you have on your statement.

Also, you need to check your credit limit. This refers to the maximum amount that you can charge on your credit card. Simply put, this also means the maximum amount that you are borrowing from your card issuing company. You can still make payments using your card, so long as you have not gone above the credit limit, and that you make at least the minimum monthly dues as stated on your billing statement.

Do you know what your credit card fees are? If you still are not familiar with these, you better check your account so you won't be surprised when you see them printed on your statement. Depending on the type of credit card and the issuing company, there may be fees imposed for late payments, cash advances, going above the credit limit, or even for making balance transfers from one credit card to another.

What is your minimum payment due? This figure is usually located next to your balance in the credit card statement. The minimum payment due refers to the smallest amount you need to pay in order for you to maintain a good credit standing with the company that issued your credit card. It is advised that you actually pay more than the minimum whenever you can. This helps you reduce your credit card debt faster, so your balance won't grow again because of interest rates.

Note the grace period as well. This lets you know how much time you have to make any payments before interest or fees are imposed on you.

Your credit card statement is something that you should keep secure. Even after you have made payments, you should have them properly documented. Be careful where you throw your billing statements, as most victims of identity theft are followed this way. There have been reports of fraudulent individuals who sift through the garbage of their intended victims, finding old credit card bills, receipts, mail, and the like.

Also, be sure to note important information found on your credit card statement, such as the contact numbers or hotlines, email addresses, and the home page of your credit card company. This helps you know who to turn to when you have additional inquiries on payments that were reflected on your credit card statement. Furthermore, knowing this contact information will help you efficiently report any loss or theft of your credit cards.