Whip through your credit card statement like a pro

“Your statement is ready” notification from your credit card app is more than an alert to delete. That statement answers questions like “how much do I have left to save and invest?” Keeping a pulse on your spending also helps you avoid interest & late charges, and protect yourself against theft.

Know your spending

Last week we simplified your bank statement to help you understand the comings & goings of your dollars (if you mainly use debit to pay for things). Now we’re doing the same for your credit card statement.

Check for errors

Credit card fraud is REAL. If you see a purchase you didn’t make, call your card company asap. You are not responsible for transactions when your card (or the number) has been stolen.

Q: So break down the jargon on my credit card statement.

Minimum payment:

The least amount you should pay to avoid a late penalty. If you only pay this (vs. your entire “statement balance” aka your total credit card bill aka your actual purchases), you WILL incur costly interest on the unpaid remainder (statement balance minus minimum payment). Credit card companies want you to only pay the minimum so they can make $$$ off the interest you have to pay. YOU DON’T want this. To avoid interest, pay off your entire statement balance each month. LOW BAR: paying the “minimum balance” = better than paying nothing (which incurs interest + a late penalty).

Billing period:

Your statement includes purchases made within this time window. Not always from first to last day of a month fyi.

Due date:

When full payment (or at least minimum payment) is due.

Your billing cycle starts 9/4. Your billing cycle ends 10/4. The total bill for your spending that month is called your Statement Balance.

You’ll get the bill soon after 10/4 but your due date to pay off that balance is 3ish weeks after the billing cycle ends (10/31 in our above example), called your grace period.

What’s the difference between Statement Balance and Current Balance - and why don’t they match? Let’s say you continue to use your credit card after the billing cycle ends on 10/4. Statement Balance = what you charged 9/4-10/4; Current Balance = adds in new purchases after 10/4, which means a higher number until you pay off your previous balance on the 10/31 due date.

Q: Simplify that box at the top of my statement for me?

This Account Summary is your overview of where your credit card stands.

Q: How do I pay my balance?

Connect a bank account to your credit card account and transfer the money. Afraid of missing your due date? Set up auto payments (e.g. auto pay Total Statement Balance in full on the due date) — as long as you’re confident you always have the money in your checking account.

Paying your balance in full each cycle is how tons of responsible people use credit cards (because they come with some perks!) and never pay a penny in interest ever. You are 100% on your way.