If you use credit cards, whether occasionally or often, it's wise to review your credit card statements. When life gets busy, you may forget to do this. But there are a few reasons you should take time each month to do a quick review. Let me explain why.
You can report any errors you find
Reviewing your credit card statement allows you to confirm each charge. Everybody makes mistakes. After reviewing your statement, you could learn that your credit card issuer charged an incorrect fee or that you were billed the wrong amount for a transaction by a merchant. But you won't know a mistake was made if you ignore your statement, resulting in wasted money.
There have been two situations where I discovered errors on my credit card statements that could have cost me money. Years ago, Capital One charged me a late fee when I had paid my bill by the due date. Luckily, I noticed the error. I reported it immediately, and the charge was removed.
A couple of weeks ago, I saw a charge to one of my Chase credit cards for a service I hadn't used in several years. After noticing the charge, I contacted the company to note that I was no longer a customer. The company removed the charge after reviewing my account details.
You'll be aware of how much money you're spending
When using credit cards, you should only charge what you can afford. If you overspend, you could rack up costly credit card debt. When you don't pay your entire credit card bill in full and instead carry a balance, you'll be charged credit card interest.
That's why you should be alert to how much you spend each month. By reviewing your statements regularly, you'll be more informed. You may find you're making impulse purchases and can adjust your spending habits to avoid further overspending.
If you struggle with overspending, consider using one of the best budgeting apps. Tools like this make it easy to set limits and monitor your spending. With time and practice, you'll get better at making purchase decisions that align with your budget and personal finance goals.
As an added note, it's also not a bad idea to review your transactions throughout the month to ensure you're on track. You can easily do this using your credit card's website or mobile app.
Find and report fraudulent charges
Another thing to be on the lookout for is potential fraudulent charges. Unfortunately, credit card fraud is a legitimate concern, and it can impact anyone. The last thing you want to do is pay for a purchase you didn't make because you forgot to review your transactions.
Many credit card companies have $0 fraud liability policies, so you won't be on the hook for paying for fraudulent transactions. However, you should report fraud quickly. Ensure you look at your statements to spot and report fraudulent charges immediately.
Stay on top of account changes that impact you
There is another benefit to reviewing your credit card statements. Your credit card issuer could update your card benefits or account terms. You'll want to know if the annual percentage rate (APR) is about to increase or if a credit card benefit you use will no longer be provided. Your credit card statement can clue you into changes like this, so you're not in for a surprise later.
Don't be in a rush to throw your credit card statement in the trash
As you can see, there are many reasons to review your account statements. If you've enrolled in paperless billing, you can log into your online credit card account to view current and past statements. You'll be a more informed consumer by reviewing these documents.
