Credit Card statements reveal information of your purchases, outstanding dues, charged interest, credit limit used/left, and so on. You will receive the statement every month. But for how long should you maintain these records? It is best to keep the papers digitally or in physical form, at least for 60 days. But you may have to retain the Credit Card statements for a longer time. This depends on the purpose for which you use the card and other circumstances.
Before we discuss the duration for which you must retain Credit Card statements, understand why you must need the statement anyways.
- Firstly, it is a must to check your credit card monthly statement. Double-check all the purchases done against receipt copies.
- Do the spending match the proof of purchases? If not, then you must find if there are any errors, and report the credit card company about it.
- Also, if you notice signs of theft or fraud, then report it to the provider without any further delay.
- Mistakes in the credit card statement will also affect your credit score negatively. So, to maintain a good credit score, ensure that your financial journey is spotless, which includes an error-free billing statement.
- If you review the Credit Card statements, you can keep a track of your spending habits. This will aid you in financial planning and living on a budget.
Why Keep the Credit Card Statement for More than 60 Days?
Usually, credit card providers allow consumers to report billing errors and fraud for up to 60 days. However, the sooner you contact the provider about the errors, the better it is for you. You can expect action sooner if you report the mistakes and fraud at the moment. In some cases, you must maintain a record of the card statement for more than 60 days, and these reasons are:
- Dispute on Incorrect Charges
If you have been charged incorrectly for a purchase or likewise, then you can raise a dispute about it with the provider. So, until the issue resolves, you must hold onto the statement. It can take a month to three for a credit card company to resolve a dispute regarding incorrect charges.
- Tax-Related Spending
If you spend using your credit card, and then wish to claim a tax deduction for such spending, then it is important to maintain a record of Credit Card statement for the particular financial year or period until which you file an income tax return, and receive the amount of the return. This is especially true if you use business credit cards. Such records can be audited, so you must keep the documents ready for a check.
- Purchases Covered Under Return Protection
Return Protection (RP) offers guaranteed returns and refunds on eligible purchases. So, even if the retailer refuses a refund on certain items, but as per the terms and conditions of RP, the purchase is eligible for protection, you will receive the due credit to the account. It is advisable to keep the statement for purchases till the protection lasts.
- Purchases Covered Under Extended Warranty
Extended Warranty (EW) offers an extension of the warranty of a specific period over the original warranty period by the retailer on items you buy on the credit card. For instance, the mobile phone you bought has a one-year warranty from the manufacturer. Under EW, you get an extension on this warranty by a year. So, the total warranty on the mobile phone upgrades to 2 years, instead of 1 year.
In this case, keep the Credit Card statements for purchases that are eligible for EW. Retain the statement until the period for which the extended warranty lasts on that purchase. In this example, you must save the statement, in which the eligible purchase is recorded, for at least 2 years.
- Credit of Rewards
Credit Card Reward Points are what you earn for purchases made on the card. There are cashback offers, and credit card reward earnings on completing a milestone. For instance, you are eligible for Rs. 800 off on flight booking of more than Rs. 5,000. But you will receive the cashback only after completion of travel. So, it is best to keep the Credit Card statement for that particular purchase as proof. Retain the statement until you receive a credit of the promised cashback or reward.
How to Ensure Safety of the Credit Card Statements?
Here is what you must do to store Credit Card statements at a safe place:
- For Online Credit Card Statements
You can keep a check on your credit card account online and download the monthly statements. The provider may offer free checking of the statement for a certain period, say up to a few years. If you want to access very old records, you have to put in a special request to the provider. To avoid these hassles, download the Credit Card statements on time.
Then you can save a copy safely on a cloud account, and computer hard drive. To restrict access, set a password for the statement copy. So, whenever you wish to open the document, enter the password, and then enjoy secured access to the statements.
- For Hard Copy of Credit Card Statements
If you opt for paper statements, then keep them safe in a file. If you have a lockable safe resistant to water and fire, then store the file in it. Remember to label the statement as per the date. For instance, for 6 months’ statement, mark the file as, say ‘January 2021 to June 2021’, and likewise. Keep the locker or desk wherever you keep the documents, organized and clean. This will allow you to reach the file quickly whenever you need it.
- Disposing of Credit Card Statements
Once the purpose for which you retained the statements is over, you can dispose of the documents. If you had kept a digital record of statements, then you can simply delete the same and free up the storage space for other essentials. However, disposing of the hard copies may require a little more effort. Firstly, you must properly shred the papers, and then throw them in a dustbin.
Some even consider burning the records if those are too confidential. Credit Card Statements contain your name, address, contact number, financial history, and other personal details. Safe disposal of records will protect you from identity theft and fraud in the future.
Credit Card Statements are not just any paper. These are important proofs of your financial journey. So, you must know how long you must maintain a record of these statements and their purpose. Store these in a secured place till the time they are required. After a point, you may have to dispose of these records. Even when you do so, follow the safety measures mentioned in this post.