Credit cards have become an indispensable part of our financial lives, offering convenience and flexibility in making purchases. However, with this convenience comes the responsibility of managing your credit card account effectively. One of the most important aspects of responsible credit card usage is regularly reviewing your credit card statement.
Your credit card statement is a detailed record of all your transactions, including purchases, payments, fees, and interest charges. It provides a comprehensive overview of your spending habits and helps you keep track of your account activity. Here are some compelling reasons why you should make it a habit to review your credit card statement regularly.
Identifying Unauthorised Transactions
One of the primary reasons to check your credit card statement regularly is to spot any unauthorised transactions or suspicious activity. Credit card fraud is a growing concern, and criminals are constantly finding new ways to steal credit card information. By reviewing your credit card statement, you can quickly identify and check any credit card charges that you don’t recognise and report them to your credit card issuer immediately. Such proactive behaviour can help you avoid credit card fraud in the long run.
For example, imagine you notice a charge for ₹5,000 from an online store you’ve never shopped at. Upon closer inspection, you realise that it’s a fraudulent transaction. By catching it early, you can dispute the charge and protect yourself from financial loss.
Detecting Billing Errors
Mistakes can happen, even with the most diligent merchants and credit card companies. Reviewing your credit card statement allows you to catch any billing errors, such as:
- Double charges for the same transaction
- Incorrect amounts charged
- Charges for goods or services you never received
Let’s say you dined at a restaurant, and the bill was ₹1,500. However, when you check your credit card statement, you notice that the restaurant charged you ₹15,000 instead. By identifying this error promptly, you can contact the merchant or your credit card issuer to rectify the situation and avoid paying more than you should.
Monitoring Spending Habits
Your credit card statement provides a detailed breakdown of your spending patterns. By regularly reviewing your credit card statement, you can gain insights into your spending habits and identify areas where you may be overspending. This information is invaluable for creating and sticking to a budget.
For instance, let’s say you set a monthly budget of ₹10,000 for dining out. When you review your credit card statement, you realise that you’ve spent ₹15,000 on restaurants and cafes. This insight can help you adjust your spending habits and make more conscious choices in the future.
Avoiding Late Payments and Interest Charges
Late payments can have serious consequences, including late fees, higher interest rates, and negative impacts on your credit score. By reviewing your credit card statement regularly, you can ensure that you make your payments on time and avoid these penalties.
Additionally, your statement will show you the interest charges incurred on your outstanding balance. If you notice that you’re paying a significant amount in interest each month, it may be a sign that you need to pay off your balance more quickly or consider a balance transfer to a card with a lower interest rate.
Maintaining a Good Credit Score
Your credit score is a crucial factor in your financial life, affecting your ability to secure loans, rent an apartment, or even get a job. One of the key components of your credit score is your payment history. By consistently making on-time payments and keeping your credit utilisation low, you can maintain a good credit score.
Regularly reviewing your credit card statement helps you stay on top of your payments and ensures that you’re not overextending yourself financially. You can also monitor your credit utilisation ratio, which is the amount of credit you’re using compared to your credit limit. Experts recommend keeping your credit utilisation below 30% to maintain a healthy credit score.
Maximising Rewards and Benefits
Many credit cards offer rewards programs, cashback, or other benefits for using the card. By reviewing your credit card statement, you can ensure that you’re earning the rewards you’re entitled to and that they’re being credited to your account correctly.
For example, let’s say you have a credit card that offers 5% cashback on groceries. When you check your statement, you notice that you’ve only received 1% cashback for your grocery purchases. By identifying this discrepancy, you can contact your credit card issuer to resolve the issue and get the rewards you deserve.
How to Review Your Credit Card Statement
Now that we’ve established the importance of checking your credit card charges, let’s discuss some tips to review your credit card statements effectively:
- Set a regular schedule: Make it a habit to review your credit card statement as soon as it becomes available each month. Mark it on your calendar or set a reminder to ensure you don’t forget.
- Verify every transaction: Go through each transaction line by line and verify that you recognise the merchant, the amount charged, and the date of the transaction. If you spot any discrepancies, make a note of them.
- Check for fees and interest charges: Review your credit card statement for any fees, such as annual fees, late payment fees, or foreign transaction fees. Also, pay attention to the interest charges if you carry a balance from month to month.
- Compare against your budget: If you have a budget in place, compare your spending against your allocated categories. This will help you identify areas where you may be overspending and need to make adjustments.
- Review your rewards and benefits: Check your statement to ensure that you’re earning the rewards and benefits associated with your credit card. If you notice any discrepancies, contact your card issuer to resolve them.
Airtel Finance: Your Partner in Financial Management
At Airtel Finance, we understand the importance of financial literacy and responsible credit management. That’s why we offer a range of tools and resources to help you stay on top of your finances.
Our Airtel Thanks app provides a convenient way to manage your Airtel credit card, track your spending, and view your statements on the go. You can also set up alerts and reminders to ensure you never miss a payment.
FAQs
- How often should I review my credit card statement?
It’s recommended to review your credit card statement at least once a month, ideally as soon as it becomes available.
- What should I do if I spot an unauthorised transaction on my statement?
If you notice any suspicious or unauthorised charges, contact your credit card issuer immediately to report the fraud and initiate a dispute process.
- Can reviewing my credit card statement help me save money?
Yes, by regularly checking your statements, you can identify areas where you might be overspending and make necessary adjustments to your budget. You can also cancel unused subscriptions or services that you might be paying for unknowingly.
- How can I remember to review my credit card statement regularly?
Set a recurring reminder on your phone or calendar to review your credit card statement each month. You can also opt for email or SMS alerts from your credit card provider to notify you when your statement is ready.
- What if I find a billing error on my credit card statement?
If you identify a billing error, contact your credit card issuer’s customer service immediately. Provide them with the necessary details, and they will investigate the issue and rectify it if the dispute is valid.
