what is meant by, "when the statement cuts"?

[Anonymous]

I am new to credit cards and would like to know what date is referred to when someone says, "when the statement cuts"? When is that relative to the due date? I'd like to control how much is on my balance when it gets reported to the CRA's each month. Thanks.

[llecs]

I use that phrase all the time. What I mean when I say "when the statement cuts" is your CC has a due date. Let's say you owe CC a balance of $100. Let's say you want a $0 balance so you pay $100 by the due date.

Now you have a $0 balance on the due date. Well the statement isn't cut on the due date. The statement may be delayed by a week or more. YMMV. So after 3-4 days you buy a widget for $50, then when the statement cust over the next few days, it could show a balance due of $50 and it will report as such to the CRAs.

I hope that makes sense. Basically, there's a no-man's land between the due date and the statement date that I don't like to use my CCs.

[Anonymous]

Ok. So can I just pay off/down to the amount I want before the statement cuts and say when the statement cuts on the 1st, can I just start using my CC on the 2nd again and pay that a few days before the statement cuts again for the next month?

[haulingthescoreup]

I'm not sure if this is what the previous poster said, but:

Your statement "cuts" (drops, posts) on a certain day. It lists everything that you've done in the last month, and it lists the total amount you owe, including carried-over balances and fees, and it lists the minimum payment due. Depending on the card, you have 2-4 weeks to pay at least that minimum payment. Any charges made during that time aren't due until your next statement.

Then a month later, your next statement cuts, and it shows any charges in the meantime, plus whatever you didn't pay from last months and fees, and the new minimum balance. And it also has a due date 2-4 weeks later. And on and on.

So your statement might cut on the August 5th, showing a total balance of $100 and a minimum payment of $15. The due date might be on August 22nd, and they need to have at least $15 credited to your account on that date. (And don't wait until that due date!) If all you paid was the $15, and in the meantime you charged another $60, your next statement will drop around September 6th, this time with a total balance of maybe $148 ($85 from last month + $60 in new charges + $3 for one month's interest on the $85), and your minimum payment is now $25, due around September 22.

If you look at a printed statement, the statement date is printed on there. That's the cut date. If you look online and click "statements", you'll probably see a drop-down box saying August 5, July 6, June 4, May 6, and so on. Those are also your statement dates.


edit to add: sorry, this is probably complete overkill for you, and your answer is at the end of the first paragraph. I threw all this in there because so many people get tangled up in this process. I hope something in there was useful for you.

Message Edited by haulingthescoreup on 08-22-2008 01:08 PM

[Anonymous]

Thanks again. I'll report back when I'm 760+