All the credit cardholders will receive their credit card statement either through post or to their e-mail. The moment we receive it we open it and check the outstanding on the card. Some might go little further to check the payment due date. But there are a few other things that every credit cardholder must read the monthly statement to make sure he/she is not missing any key information related to their credit card account.
Listed below are six such components one should check in his/her credit card monthly statement.
Transaction details: Even before you check the outstanding due on the card, one section you must check is the transaction details. Here you find the list of all the transactions you have done during the last billing cycle. It’s important to check the details carefully to find any discrepancies in the billing. Sometimes banks may include transactions that you haven’t done. If you find any such things you can immediately report it to the bank.
Outstanding due: The outstanding due on your credit card is something which changes every month according to your expenditure on the card. You must, therefore, check the outstanding due on your card to know how much you owe to the bank for the month according to which you can plan your expenses.
Payment due date: Once you check the outstanding on your card, make sure you check the payment due date to avoid late payments. Failing to pay the credit card bill on time will make you shell out more money towards interest and late payment fee. Unless you have subscribed to standing instructions, make a note of the due date and make you pay your bill 2-3 days before the due date. This will allow some time for the payment to be processed by the payee bank. Further, it saves you from paying late payment fee and other related charges.
Minimum amount due (MAD): In case, you cannot afford to pay the outstanding due for a particular month, you can pay the minimum amount due which is typically 5% of the outstanding. If you ever want to pay MAD, you must check the same on your statement. Once you pay the MAD amount, late payment fee will not be paid but interest will be charged on the remaining amount till is paid back in full. Therefore use the MAD facility only when you cannot afford to pay the entire bill.
Total/Available credit limit and cash limit: You have checked the due amount on the card, due date and even the MAD amount. Now what else you need to check. Well, the aforementioned components may tell you how much you spent on the card, but in order to use the card further, you must also know how much amount is available to spend.
Credit limit and cash limit are the components which tell you how much amount is available on the card. Under credit limit, you will find two things total credit limit and available credit limit. While the former indicates the amount sanctioned by the bank at the time of issuing the card, the latter tells you how much is available to spend. The total credit limit on a card remains the same always, whereas the available limit keeps changing with the amount of spend on the card.
Another important limit to know is the cash limit, which is the amount available on the card for cash withdrawal.
Reward points: Reward points programme is an interesting feature offered by most credit cards. Most of us don’t give much attention to the number of points accrued on the card. But keeping a track of them would prevent us from losing the points. Once you know that you have reached a minimum number of points required for redemption, you can do it instantly or retain them for another expensive redemption.