How to Balance Your Checkbook

Some of your most recent transactions might end up on your next month’s statement. Make sure you note those transactions in your personal record to avoid any https://www.quick-bookkeeping.net/ surprises. One of the reasons why balancing your checkbook has become passé is because most people no longer carry a checkbook, or even paper and pencil.

Benefits of balancing a checkbook

If your spending tracker has a smartphone app, you can enter the info there, just like with a pen-and-paper register. You can balance your own checkbook by keeping a paper or digital log of bank account transactions accounting and finance for business that you can compare against your bank statement each month. Compare the total amounts of withdrawals and deposits on your register to the information available from your online or mobile banking app.

A Refresher on Entering Transactions Into Your Check Register

Even today, when much (if not all) of your transaction information is available with the click of a button, it’s still a good idea to maintain a record of your transactions and regularly balance that record. If all else fails, you can also ask for checkbook balancing help from a bank teller at your local branch. While some banks offer free assistance, others may charge a fee, so be sure to check with your bank to see if you need to pay.

Learning to balance a checkbook

Now you know that you have $950 left to spend from your account, rather than what shows as your current bank account balance of $1,000. Any time you write a check, make a payment using your debit card, or initiate any other kind of debit or withdrawal, always record the transactions in your spending tracker or checkbook ledger. To get started, you might consider methods you’re already comfortable with. If you like to use your phone for everything, it may work to use an app to check the bank account balance each day. You could also decide to set up alerts to let you know when transactions occur.

Understanding the Importance of a Balanced Checkbook

These programs may automatically populate some transactions, but there is still plenty of manual recording you can do with them, both on your computer and your phone. The benefit of a program like this is that it often balance sheet items items of balance sheet with explanation will nudge you to complete your necessary tasks, and it will walk you through the process of balancing your records. Creating any new financial habit — especially balancing your checkbook — can be challenging.

1. Hold on to important transaction receipts until you’ve balanced your checkbook for that month.
2. But what do terms like “balance,” “checkbook” and “register” even mean in today’s online world?
3. If you’ve tried all these and the balances still aren’t matching up, try taking a break for a while.
4. You may prefer online and mobile banking for checkbook balancing if you don’t write paper checks or only write a few each month.
5. Balancing your checkbook in today’s digital world may seem redundant, but it’s critical for two reasons.
6. You should be able to find this amount by checking using your online or mobile banking app.

Make note of the dates, descriptions, and amounts of any check, debit, or ACH payments listed in your check register but not on your statement — the ones without checkmarks. Verify the amount you entered in the check register matches the debit amount on your statement. Place check marks on your check register and statement next to all matching transactions.

Try your best to note every time you make a payment, even if it’s for a small amount. Once you’re used to the recording process, pay attention to how you’re spending your money. If you don’t regularly write https://www.quick-bookkeeping.net/explanation-of-certain-schedule-c-expenses/ checks, balancing a checkbook may not be necessary. That Gomez, Gomez recommends reviewing your spending consistently through a spreadsheet or budgeting app, even if you don’t write physical checks.

With online and mobile banking apps, you may be able to get real-time access to your accounts and get notifications when your bank account is at risk. But even with access to digital tools, balancing your checkbook monthly will help you ensure that your spending records align with your bank’s. If you’re using the checkbook register method and comparing transactions with your account statement, you should balance your checkbook every month. If you’re using online banking or mobile banking to track your accounts, you can log in daily to view new credit and debit transactions as well as balance information. Still, balancing a checkbook can be a valuable exercise if it helps you monitor your spending, allowing you to detect fraud and avoid overdrafts. When you’re checking your account statements and transaction history regularly, it’s more likely that you’ll be able to spot any suspicious transactions.

If your bank charged you any service fees for writing checks, accessing out-of-network ATMs, or any other service, find these charges on your statement and record them in your check register. If your bank reimburses ATM fees, find these reimbursements on your statement and enter them as deposits in your check register. Some banks still mail out monthly bank statements around the end of the month, but many have switched to online statements only.

Even if your transactions are mostly digital, balancing your checkbook is a good idea because it can help you avoid overdrafting your account, paying erroneous charges or even becoming a victim of fraud. If your check register and bank statement don’t balance, double-check your math to see if there are any adding or subtracting errors on your register. If you’re not using your checkbook, go through your checkbook and add up all your bill payments for the month.