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Do you ever open your credit card statement only to feel like you need a finance degree with a math minor to understand it? If you do, you're definitely not alone. To make it even harder, no two credit card companies seem to provide their statements in quite the same format or have exactly the same rules.

No Two are the Same!

Although the Federal government has been trying to standardize some things and make it simpler for the typical consumer to understand, fully comprehending a credit card statement can still be a little tricky. To add insult to injury, if you miss a critical piece of information, it can mean getting hit with high fees or increased interest rates, something that no one in this economy can easily afford!

An Easy Guide to Understanding Your Statement

If you've ever wished someone would make it a little bit easier to understand, this guide should help. Pull out your monthly credit card statement and compare it with the following explanations:

• Charges - Check this first. Each monthly statement should list each new charge complete with the name of the organization, the date of the purchase, and how much was borrowed. Keep all charge receipts to compare with this list. Notify your credit card company immediately if anything doesn't match up. Problems could include double charges, invalid charges, and incorrect amounts. Call first, but always follow up in writing. Also, make sure that each item is associated with the correct interest rate. Cash advances usually incur a higher rate than store purchases, while balance transfers sometimes get a special incentive rate.

• Previous Balance - This is the amount that you owed at the end of last month before any new payments, purchases, or charges were applied. Always check it for accuracy.

• Payments and Credits - Similar to checking for new charges, make sure that every payment and credit is applied correctly. Here's a sneaky trick that happens sometimes. You may return something that would have incurred a high rate of interest. When the credit is applied, it might be taken out of the lowest rate bucket - call your credit card company if this happens.

• Cash Advances - This amount shows how much you've borrowed as a cash advance. Most cards charge more for cash advances than for purchase, and you might not have a grace period on this amount. Before credit card reform, your payments would be applied to the cash advance amount last to maximize interest charges. Credit card companies are now supposed to apply payments to the balances with the highest interest rate first.

• APR, or Annual Percentage Rate - This is one of the most important pieces of information on your statement if you don't pay off your balance each month. As this number increases, so will your monthly payment and your total cost. Whether you have a "fixed" rate or a variable one, banks can easily change this number with little notice. Late payments and going over your balance can trigger an increase in your APR, and the bank only has to give you a 15-day notice to raise your interest rate for any reason at all.

• Finance Charges - This value tells you how much in interest and fees you were charged for the month. If you don't pay off the complete balance each month, many cards have a minimum finance charge. To make this simple to understand, this is the amount that you pay the bank each month in return for using their money. Your credit card company may calculate finance charges based on the average daily balance or some other formula.

• Grace Period - If you don't carry a balance, you may have a period of time to pay the bill off before interest is charged. By carrying a balance, you lose this benefit with most credit cards. Generally, cash advances and balance transfers do not have grace periods.

• Minimum Payment - This is the very lowest amount you can pay on your bill to be considered in agreement with your card's terms. It generally varies from two to four percent of your balance.

• Due or Pay-by date - Your payment must be received, not postmarked, by this date to be considered on-time. To ensure timely payments, mail the payment at least 10 days early or pay your bills online.

• Credit Limit - This is the maximum amount that you can borrow on the card. The cash advance limit may be less than the total amount allowed. Credit limits can change, so always check this value before making a large purchase.

• Late Fee - If you don't make your payment by the due date, you'll probably incur a late fee of up to $35.

• Over-the-Limit Fees - If you charge more than your credit limit allows, you may be charged an over-the-limit fee. Even a late fee that takes you past your limit can trigger this charge.

• Personal Information - Always make sure that your name, address, and account numbers are correct.

• Miscellaneous Fees - This could include things like credit insurance. If you're being charged for anything you don't understand, give your company a call.

Now that you're armed with this valuable information, you'll never have to feel like your credit card statement is a mystery again!