A 2014 poll by GOBankingRates revealed that 37 percent of banking customers in the United States never write personal checks, but that doesn’t mean a checking account isn’t an integral part of your finances.
Even though online banking and smartphone apps let you check your balance instantly, it’s still important to know how to balance your checking account.
Reasons to Balance Your Checking Account
Balancing your checking account is key if you want to know exactly how much money you have in your account at any given time. You might be able to instantly check the balance of the account, but pending transactions may not post for 24 hours or more, so they may not be reflected when you check your balance. Make sure you take those transactions into account if you’re planning on spending based on your current balance. Benefits of a balanced checkbook include the following.
- You can ensure that your records match statements from the bank and can quickly catch any errors.
- You may notice any identity theft or fraud sooner.
- It can help avoid bounced checks and the associated overdraft fees.
Manually Balance Your Checking Account
Traditionally, manual methods have been used to balance a checkbook or a checking account. If you want to see your deposits and withdrawals in black and white on paper, manual methods might be suitable for you.
Receipts: Receipts should be kept and then used to check outgoing payments. Whether you pay for groceries with your credit card, debit card or withdraw cash from an ATM, save the corresponding receipt until you can match it to your most recent bank statement. Receipts serve as proof of your financial transactions. If there are any discrepancies, you can contact the bank to find out more.
Checkbook: Use a physical checkbook to track payments received as well as checks written. In this way, you should have a running total of your account’s balance at any given time. Periodically, you can compare your personally calculated total to that of your most recent bank statement. Differences can reveal either a miscalculation on your part, an error from the bank or even financial fraud.
Electronically Balance Your Checking Account
In today’s tech-focused world, you may not need to know how to balance a checking account manually, particularly if you never write physical checks. There are several ways to digitally stay on top of your checking account.
Log in often to online or mobile banking: The whole point of this checkbook balancing act is so you are aware of where your money is going and how much is currently available to you. Logging in on a regular basis keeps you informed about any unusual activity or low balances.
Opt in for electronic statements: If you don’t want to receive physical bank statements in the mail, sign up for electronic statements and check them monthly. Confirm that they match your own tracked spending as well as any automatic draft payments or electronic bill payments.
Visit usbank.com for more information about checking accounts.