Check Your Paper Credit Card Statements

Can we all agree that going paperless is the way to go for the environment, for convenience, and just to eliminate a source of clutter in our homes? Not so fast. Credit card companies appear to be putting one over on millions of consumers who don’t have the time, or just haven’t noticed that there is a big difference between the consumer information available to you when you simply sign on to your online credit card account and pay your bill, and the information available on your paper bill. Some credit card companies don’t even list finance charges as a transaction on your primary online transaction screen. You typically have to look at your paper bill for that information. It used to infuriate me that I had to search online for my APR and interest paid information — especially during the period of time when the credit card companies were increasing interest rates on most of their customers. How many people were reading the fine print sent by mail, or searching their account web sites for APR information? How many consumers today are aware of the current APR they are paying on their credit card accounts?

To be fair, a downloadable version of your paper bill is available online — but you really do have to look for it. It’s usually a single, small hyperlink somewhere on one of your account screens labeled “online statement” or “see statement” or “View your billing statement for this period” or “View Complete Statement with APR”. And it’s almost always in a .pdf file that you are prompted to “view”. When you do find this .pdf version of your credit card statement, you will see there some information you really should be looking at. In addition to your Annual Percentage Rate (APR) and the amount of interest you are paying each month, credit card companies are now required to provide important payoff information under the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009 — but it’s only available on the paper version of your credit card bill. The payoff information now required on paper statements clearly demonstrates that if you make only the minimum payment each month, you will pay a lot more in interest and it will take you longer — in many cases decades longer — to pay off your balance.

For example, let’s say you have a credit card charging 19.8% and have run up a balance of $4,800, and your credit card company is requiring a minimum payment of $124. Have you ever wondered how long it will take to pay off the balance? Making a typical minimum payment each month it would take 21 years to pay off the balance. However, and this is striking, by paying $178 each month, an additional $54, the payoff period shrinks to only 3 years. That additional payment each month can shave 18 years off the payoff period, and save $4,456 in interest charges.

So consumers beware. If you do opt for paper credit card statements, look for the online version of your paper statement when you log on to your credit card accounts.