How to read and understand your credit card statement

Reviewing your credit card billing statement each month can be a useful way to monitor your finances and help you keep track of your recent transactions. Although your statement contains relevant information regarding your recent activity (including purchases and payments), it can be difficult to understand the ins and outs of your billing cycle, fees, transactions and more.

Ahead, you'll find:

A breakdown of your credit card monthly statement
Some points to consider when reading it, and
How long you may want to keep your statements

What is a credit card statement and how does it work?

Your monthly credit card statement is a record of your recent transactions, activity, and any applicable fees and interest charges. Credit card companies and banks typically mail out your monthly statement after the end of your billing cycle.

If you've signed up for paperless billing, you'll receive an email notification that your monthly statement is available.

What is in my credit card statement?

Your credit card statement is made up of your recent transactions, payment information and details about your account. Monthly credit card statements typically contain the following:

Your account summary
Statement balance
Available credit
List of recent transactions
Minimum payment due
Total reward points earned
Minimum payment warning

When do credit card statements come out?

Your monthly credit card statement is typically available at the end of your billing cycle. A billing cycle is a period of time during which your credit card transactions are recorded and processed into a monthly statement. Your credit card statement may arrive in the mail or your email inbox (if you have opted for paperless statements) each month, approximately 21 days before your next minimum payment is due.

What do the parts of a credit card statement mean?

Your credit card monthly statement may show the following:

Previous balance: Your statement will include your previous balance, which is the balance you owed at the end of the last billing cycle.
Minimum balance due: This is the minimum amount you should pay before your specified due date to avoid a late payment. This section will typically also include details on late payment charges in the event of a previous late or missed payment.
Notice of changes: If applicable, your monthly statement will list any upcoming changes to your interest rates. Banks are required to notify you at least 45 days before your interest rate changes apply to your account.
Interest charges: Your monthly statement will highlight APR charges you may have incurred, such as for purchases, balance transfers, and cash advances.
Fees: A section in your credit cards statement will contain any fees you may have incurred throughout the past billing cycle, like annual fees, late fees, overlimit fees, balance transfer fees, cash advance fees, and foreign transaction fees.
Recent transactions: You'll find a list of recent purchases, cash advances, and balance transfers listed in the transaction section of your statement. If you have an authorized user on your account, you may find their transactions listed on a separate line or section on the statement. It's important to read this section over to confirm that you authorized all of these transactions.
Credit limit: Your credit limit is the maximum amount you are able to spend on the credit card. This is different from the available credit on your account.

What can I learn from my credit card statement?

Look out for these things in your monthly statement:

Fraudulent charges: By reviewing your statement each month, you can confirm that all the transactions listed were authorized by yourself or made by an authorized user. If you do notice any transactions that you suspect to be fraudulent, you can call your credit card company to learn more about the charge and how to report it.
Payment due dates: Your monthly statement will highlight your upcoming payment due date. Reading your monthly statement when it arrives in the mailbox can serve as a reminder for you to pay your credit card bill. Not paying at least the minimum amount due may hurt your credit score.
Minimum payment warning: Your statement typically includes a section detailing how long it may take to pay off your account through minimum payments (each billing cycle) in the event that you do not add more to the balance. In this section, you'll usually find this information explained through a debt payoff chart, which you may find useful when managing your debt.
Patterns in spending: Looking over your statement can also help you pinpoint habits such as overspending and gives you an opportunity to make sure you're staying within your budget.
Changes in fees: You can also keep track of when interest may start applying to your account if you are currently in a low APR promotional period. Your statement can also keep you updated on fees related to balance transfers and statement credits from refunds and returns.

How long to keep credit card statements

Keeping a paper credit card statement or monthly bank statement for at least a year could be useful for issues like disputes and taxes.

If your statements are available in your online bank portal, keeping paper copies around is likely unnecessary. Banks have to keep many types of records for at least 5 years. Chase account holders, for instance, can access up to 7 years of account statements. If a specific statement is not available to view online, you may be able to order it from the financial institution.

In conclusion

Your credit card statements are full of important pieces of information that can help you manage your account. By gaining a better understanding of your monthly statement, you may be able to prevent confusion and surprises when it comes to fees and interest rates. You can also learn more about your spending habits while keeping an eye out for fraudulent charges or errors. Statements are usually available online for 5 or more years, which is helpful if you don't want to keep several years worth of paper copies around.