8/13/2023 0 Comments Practice for checkbook registers![]() For each credit (refunds, deposits or interest), you can add the amount of the transaction to your balance. For each debit (purchases, withdrawals or fees), you can subtract the amount of the transaction from your balance. You can do this on whatever schedule works for you, but try to check in at least once a week.Ĭalculate running balance: When you record each transaction, do the math to calculate your running balance. Write down the transaction date, amount and a brief description. Keep track of each type of transaction - purchases, bill payments, withdrawals, deposits, refunds and even bank fees and interest. Record all transactions: As you continue to make transactions, write them down in your record. Record pending transactions: If you have pending transactions (bill payments, written checks, debit/credit card transactions, etc.) not yet factored into your current balance, record these transactions next. Find your “available balance” and jot down this figure as the first entry in your new record. To do this, you can use a checkbook register, a spreadsheet or a good old fashioned pen and paper.Ĭheck your account balance: Search your most recent checking account statement or take a look at your online banking account. If you’re wondering how to balance a checkbook, you can follow the steps in the “balancing a checkbook worksheet“ below:Ĭreate a record: To keep track of your finances, it’s helpful to have a detailed record of all the transactions you make. ![]() The process of reconciling your accounts looks a little different today than it did 20 years ago, but the principles remain the same. By taking the time to record transactions weekly, you can begin to notice trends that help you create a budget you can stick to. If you’re looking for ways to cut back on expenses, the first step is understanding where each and every cent is being spent. Reconciling your accounts also helps you reflect on where your money is being spent. By reconciling your account, you’ll have a better idea of your available funds (while factoring in all the pending transactions). Reconciling your checkbook will help ensure you have adequate funds in your account, even if the check clears weeks or months after writing it.Īvailable funds & bank fees: If you make a transaction that exceeds the available funds in your account, you may be charged overdraft fees by your bank. While banks typically refund these charges, the process can be expedited if you spot the transactions and report them as soon as possible.Ĭheck payment status: If you still fill out checks frequently, you’ve probably realized some checks get cashed long after you write them. The sooner you contact the merchant about these errors, the more likely they are to correct them in a timely manner.īudgeting & financial habits: Keeping an eye on your accounts and a record of your transactions can help you create better financial habits and make it easier to maintain a budget.įraudulent charges: If you become a victim of identity theft, an online scam or a stolen debit card, you may notice fraudulent charges in your account. Merchant errors: Merchants can also make payment processing mistakes, like charging you an incorrect amount or not processing a refund. By reconciling your account, you can ensure bill payments, deposits, transfers and other transactions are processed correctly. Here are a few other reasons why it can be beneficial to balance your accounts:īank errors: While bank errors are rare, they do happen occasionally. Reconciling your account on a regular basis helps ensure the bank’s records match your records, and that no transactional issues have occurred. Let’s have a look at how to balance a checkbook in a digital world and why it’s still a solid practice to consider: Why balance your checkbook? Balancing your online checkbook is still a valuable practice that can help you catch accounting mistakes and foster better financial habits. Since most of us have 24/7 access to online banking and transaction records, you may be wondering whether it’s necessary to balance checkbook records in the modern financial world. Balancing a checkbook is the process of conducting a monthly reconciliation of your physical checkbook to make sure it matches the paper statement your bank mails out. ![]() Back in the good ol’ days, when it was the norm to rent VHS tapes from Blockbuster and glanced down at pagers for work updates, the practice of balancing a checkbook was an important part of maintaining financial wellness.
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