How to Understand Your Credit Card Billing Statement - The ...

Your credit card statement will typically come in the mail, but if you've opted for online, or paperless billing statements), you'll either receive an email ... CreditCardBasics Billing&Payment HowtoUnderstandYourCreditCardBillingStatement By LaToyaIrby FullBio LinkedIn Twitter LaToyaIrbyisacreditexpertwhohasbeencoveringcreditanddebtmanagementforTheBalanceformorethanadozenyears.She'sbeenquotedinUSAToday,TheChicagoTribune,andtheAssociatedPress,andherworkhasbeencitedinseveralbooks. Learnaboutour editorialpolicies UpdatedJanuary31,2022 Reviewedby KhadijaKhartit Reviewedby KhadijaKhartit FullBio LinkedIn Twitter KhadijaKhartitisastrategy,investment,andfundingexpert,andaneducatoroffintechandstrategicfinanceintopuniversities.Shehasbeenaninvestor,entrepreneur,andadvisorformorethan25years.SheisaFINRASeries7,63,and66licenseholder. Learnaboutour FinancialReviewBoard Creditcardissuershavealegalrequirementtosendyourmonthlycreditcardstatementatleast21daysbeforeyourminimumpaymentduedate.Billingstatementsusuallyconsistofoneortwopagescontainingagooddealofinformationaboutwhatyou'vecharged,howmuchyoupaidlastmonth,whatpaymentyouneedtomake,andthedatebywhichyourpaymentmustbereceivedtoavoidpenalties. Yourcreditcardstatementwilltypicallycomeinthemail,butifyou'veoptedforonline,or paperlessbillingstatements),you'lleitherreceiveanemailstatementoryou'llneedtologontoyourcreditcardissuer'swebsitetocheckyourstatement.  Whenyoureviewyourstatement,you'llfindseveraldifferentcategoriesofinformationprovidingdetailonavarietyofaccountcharacteristics,describedbelow. AccountSummary ©LaToyaIrby Theaccountsummarygivesanoverviewofyourcreditcardaccountstatus.Hereyou'llfindyourcurrentbalance,feesandinterestchargedsinceyourlastbillingstatement,theamountofcredityouhaveavailable,andthedateyourbillingcycleclosed.Thisisusuallythefirstsectiononyourcreditcardstatementbecauseitcontainssomeofthemostimportantinformation. Paymentsandtransactionsthatpostedtoyouraccountafterthebillingcycleclosedwon'tbereflectedonthiscreditcardstatement.However,ifyoulogintoyouronlineaccount,youcanseebalancewilltypicallyincludeyourmostrecentactivity. PaymentInformation ©LaToyaIrby Thepaymentinformationsectionliststhepaymentyoumustmaketoavoidlatepaymentpenalties. Thissectionincludesyourminimumpaymentandpaymentduedate.Ifyoupaylessthantheminimumoryourpaymentisreceivedaftertheduedate,youcouldbechargedalatefee,haveyourinterestrateincreasedifyou're60ormoredayslate,andhavelatepaymentaddedtoyourcreditreport. Thelatepaymentwarningdisclosureexplainsspecificallywhatwillhappenifyourpaymentislate. LatePaymentWarning ©LaToyaIrby Creditcardissuersarerequiredtoincludealatepaymentwarningonbillingstatements.Thissectionshowstheconsequencesofsendingyourpaymentlate,i.e.,after5p.m.onthepaymentduedate. You'llfindouttheamountofthelatefeeandthepenaltyAPRthatcouldbeappliedtoyouraccountifyoudon'tmaketheminimumpaymentbytheduedate. Thelatepaymentwarningshowsoneverycardholder'sbillingstatementregardlessofthecurrentpaymentstatus;itdoesn'tmeanyou'vedoneanythingwrong.Ifyouhadbeenlateonapreviouspayment,thepaymentinformationsectionwouldincludeapastdueamount. Latefeesarenowlimitedtothelesserofyourminimumpaymentor$28,oramaximumof$39ifyou'vebeenlateonapaymentintheprevioussixmonths. Thecreditcardissuerisn'tallowedtoraiseyourAPRtothepenaltyrateunlessyou're60daysdelinquentonyourpayment.Inotherwords,notuntilyou'vemissedtwopayments.Oncethepenaltyrategoesintoeffect,itwillremainuntilyou'vemadesixconsecutivetimelypayments. Then,itwillbelowered,atleastforyourexistingbalance.Somecreditcardissuersleavethepenaltyrateinplacefornewpurchasesmadeaftertheratewastriggered. Thelatepaymentwarningdoesnotincludethecreditreportingconsequencesoflatepayments.Afteryourpaymentis30dayspastdue,thepast-due accountstatusmaybereportedtoacreditbureau. Onceyoubringyouraccountcurrentagain,theaccountstatuswillshowthatyou'recaughtuponpayments,butyourcreditreportwillcontinuetoshowthelatepaymentforsevenyears. MinimumPaymentWarning ©LaToyaIrby Creditcardissuersarenowrequiredtopostaminimumpaymentwarningonyourcreditcardstatement.Thisdisclosuretellsyouhowlongitwilltaketopayoffyourbalanceifyouonlymaketheminimumpayment.You'llalsofindoutthetotalamountyou'llpay,includinginterestcharges, ifyoumaketheminimumpayment. Thewarningmustalsoincludethemonthlypaymentneededtopayoffyourbalancein36monthsandthetotalamountyou'llpayifyoumakethatpayment. Ifyoudecidetomaketheminimumpaymentafterreadingthissection,youdosoknowingthatit'sgoingtotakethemaximumamountoftimeandyou'llenduppayingthemaximumamountofinterest. Thesecondbox,showingthe3-yearpayoffpayment,letsyouknowtheamountofsavingsyou'dreceivebyincreasingyourpayment. Youcanuseacreditcardrepaymentcalculatortofigureouttheimpactofvariouspaymentamountsorthepaymentamountneededtorepayyouraccountbyacertaindeadline. CreditCounselingNotice ©LaToyaIrby Yourcreditcardbillingstatementmustgiveyouthecontactinformationforanonprofitcreditcounselingagencythatyoucancontactifyou'rehavingtroublemakingyourcreditcardpayments.Thesooneryougethelpthebetter. Keepinmindthatcreditcounselingoffersalong-termsolutiontoyourcreditcardrepayment.Ifyourfinancialproblemsareshort-term,firstcallyourcreditcardissuertoseeifyoucanpostponeyourpaymentafewdaysandavoidapenalty. AccountChangesNotification ©LaToyaIrby Anychangestoyouraccount,likeanannualfeeorincreasedinterestrate,willappearonaspecialsectiononthefrontofyourbillingstatement.Thestatementmustalsoincludetheeffectivedateofthesechanges. Detailsaboutthechangesmightalsobemailedinaseparately,somakesureyoureadalltheinsertsincludedwithyourstatementandanyextracorrespondencefromyourcardissuer. PaymentCoupon ©LaToyaIrby Yourcreditcardstatementwillincludeapaymentcouponthatyoucanincludewithyourcreditcardpayment.Includingthecouponhelpsthecreditcardissuerprocessyourpaymentandapplythepaymenttothecorrectaccount.Ifyou'remailingyourcreditcardpayment,detachthecouponandplaceitintheenvelopewithyourcheckormoneyorder. AddressChangeNotification ©LaToyaIrby Ifyourmailingaddresshaschanged,makesureyouupdatethecreditcardissuerwithyournewaddresstoensureyoureceivefuturebillingstatements.Checktheboxindicatingtheaddresschangeandwriteyournewaddressonthebackofyourcreditcardstatement. Youcanalsogiveyourcardissueracalltoletthemknowyournewaddressorevenchangeitonlineifyourcreditcardissuer'swebsiteallowsyouto. CreditCardIssuerPaymentAddress ©LaToyaIrby Ifyou'reusingtheenvelopethatcamewithyourcreditcardstatement,makesurethecreditcardissuer'saddressshowsthroughthewindow.Otherwise,yourpaymentcouldgotothewrongaddress.Ifyouuseadifferenttypeofenvelopewithoutthewindow,copythecreditcardissuer'spaymentaddresstothenewenvelope. Yourcreditcardissuermayhaveadifferentaddressforprocessingcorrespondence,likeabillingerrordispute.Thataddresswillbeprintedsomewhereelseonthebillingstatement,perhapsonthebackofapage. TransactionsfromtheMostRecentBillingPeriod ©LaToyaIrby Paycloseattentiontothetransactionssectionofyourbillingstatement.Makesureallthetransactionsandamountsareaccurateandreportfraudulentorunauthorizedchargestoyourcreditorimmediately. Sinceonlythetransactionsfromyourmostrecentlycompletedbillingcyclewillbelisted,you'llhavetorefertopreviousbillingstatementsforoldertransactions.Transactionsmadeafterthebillingcycleenddatewillappearonyournextbillingstatement. MonthlyInterestCalculation ©LaToyaIrby Interestiscalculatedseparatelyforeachtypeofbalanceyouhaveonthecreditcard,includingpurchases,balancetransfers,andcashadvances.PromotionalAPRsandtheirexpirationwillbelistedinthissection. TotalInterestandFeesPaidThisYear ©LaToyaIrby Yourbillingstatementmustincludearunningtotaloftheinterestandfeesyou'vepaidthisyearonyouraccount.Youcanreducetheamountofinterestyou'repayingbyeithernegotiatingalowerinterestrate,whichmaybedifficulttodo orbypayingyourbalancefaster. RewardsSummary ©LaToyaIrby Ifyourcreditcardcomeswitharewardprogram,asummaryofyourrewardswillappearonyourcreditcardstatement.Thissectionwillgenerallyincludeyourrewardbalance,rewardsearnedthisperiod,andamountofrewardsavailableforredemption. ArticleSources ConsumerFinancialProtectionBureau."RegulationZ§1026.5GeneralDisclosureRequirements."AccessedJan.31,2021. WellsFargo."HowtoReadYourCreditCardStatement."AccessedJan.31,2021. FederalTradeCommission."CreditCardAccountabilityResponsibilityandDisclosureActof2009SecC.171.LimitsonInterestRate,Fee,andFinanceChargeIncreasesApplicabletoOutstandingBalances."AccessedJan.31,2021. Discover."WhatDoesItMeanWhenMyCreditCardPaymentisPastDue?"AccessedJan.31,2021. LegalInformationInstitute.“15U.S.Code § 1681c.RequirementsRelatingtoInformationContainedinConsumerReports.”AccessedJan.31,2021. FederalTradeCommission."CreditCardAccountabilityResponsibilityandDisclosureActof2009Sec.201.PayoffTimingDisclosures."AccessedJan.31,2021. FederalTradeCommission."CreditCardAccountabilityResponsibilityandDisclosureActof2009Sec.101ProtectionofCreditCardholders."AccessedJan.31,2021. ConsumerFinancialProtectionBureau."RegulationZ§1026.7PeriodicStatement."AccessedJan.31,2021. Share Tweet Share Email StatementClosingDatevs.PaymentDueDate:What'stheDifference? CreditCardPenaltyandDefaultRatesExplained WhatIsaCreditCardBillingCycle? WhatIsaMinimumMonthlyPayment? WhatIsaFinanceCharge? HereIsWhatHappensWhenYouMakeaLateCreditCardPayment YourCreditCardPaymentIsLateifIt'sNotMadebyThisDate ImportantCreditCardDatesYouShouldKnowAbout CreditUtilization:The2ndBiggestFactorinYourCreditScore HowYourCreditCardPaymentIsSplitWhenYouHaveMultipleBalances MissingaStatement?KnowYourRightsUndertheCreditCardAct GettheBasicsofCreditCardBalanceTransfers EveryCreditCardUserShouldKnowThisAboutTheirBillingStatements. WhatIsaCreditCard? ProsandConsofPaperlessBilling WhyaCreditReportMayShowtheWrongCardBalance