a course on how to balance a checkbook for dummies

How do I balance a checkbook?

Jun 17, 2021 · Next steps: Tips for remembering to balance your checkbook Creating any new financial habit — especially balancing your checkbook — can be challenging. It’s a good idea to set aside a certain time at least once a month as you get started. Set a reminder on your phone or calendar for once a week.

Why is it important to have a balanced check book?

Mar 04, 2021 · Starting with the first transaction you enter, subtract the amount from your available balance—in the case of a deposit, add it to the balance. Then record the new amount on the next line of your register. Continue doing so until all transactions are recorded.

How often should you balance your checkbook?

Jan 04, 2022 · 2. Find out your current balance. Log on to your account online, call or visit your bank, or visit an ATM and get the current balance on the account you wish to track. Write this balance in the box at the top of the page or on the empty first line with the note "balance forward".

Is your checkbook unbalanced?

May 14, 2011 · If balancing your checkbook is something you dread, let Candice explain the how to of balancing your checkbook. Lots of helpful tips to make sure you avoid b...

What are the steps to balancing a checkbook?

How to Balance a Checkbook: Step-by-StepStep 1: Recording your transactions. ... Step 2: Review your monthly bank statement. ... Step 3: Check that your balances match. ... Step 4: Address any errors or fraudulent activity. ... Step 5: Draw a line in your register. ... Step 6: File your bank statement.Jan 30, 2019

Where would I go to learn about balancing a checkbook?

Look up the “current available balance” in your checking account. You can find this information on either your bank's website or through its mobile app. If you're using a paper checkbook register, you'll record this number in the top spot above the spaces you use to log your transactions.Jul 12, 2020

How do I balance my checkbook after a month?

If you have checks that have been outstanding for three or more months, contact the person or business the checks were written to and ask for the current status of the check. Has the individual/business lost or forgotten the check? Encourage them to cash it as soon as possible.May 30, 2019

Is balancing a checkbook still necessary?

Balancing your checkbook will help you make sure you have enough money in your account to cover all of your withdrawals and payments. It's a way to have peace of mind knowing that your check won't bounce or your debit card won't be declined next time you're at the checkout line.Jan 9, 2021

How often should you balance your checkbook?

Commit to balancing your checkbook on a weekly basis, which may be easier than trying to do it once a month or less often. Recording transactions daily, then balancing at the end of the week, can help keep the system as simple and error-free as possible.

What do you do when you can't balance your checkbook?

10 Things to Do If Your Account Doesn't BalanceVerify you're working with right account.Look for transactions that the bank has recorded but you haven't.Look for reversed transactions.Look for a transaction that's equal to half the difference.Look for a transaction that's equal to the difference.More items...•Mar 26, 2016

What two items do you need to reconcile your checking account?

To reconcile you will start by taking the bank statement and going to your account to compare the two. Mark off the transactions one by one to ensure the balances match. The adjusted totals should be the same. Be sure to prepare appropriate journal corrections and adjustments (interest, outstanding deposits).Mar 21, 2014

What does it mean to balance a checkbook?

What does it mean to balance a checkbook? To “balance a checkbook” — in its literal and maybe old-fashioned sense — means going through your bank statement and checking each transaction against what you've recorded in your check register.Jun 17, 2021

Why is it important to balance your checkbook?

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.

How to record a check?

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. If you’re writing a check, note the following info in the checkbook ledger too: Check number. Date.

Do you know how to balance a checkbook?

Not everyone knows how to balance a checkbook. If you learn, you can always know your actual account balance, helping you reduce your chances of getting hit with overdraft charges. You’ll also be able to keep an eye out for fraud and errors, and better manage cash flow and debts.

How To Start?

When looking at how to begin balancing your checkbook, you’ll want to go to the bank to issue the most recent bank statement of your available funds on your checking account.

Why Is Balancing Your Checkbook Important?

When looking at the importance of keeping your checkbook balance, the main reason is t o not overdraft.

How To Prevent Errors In Checking

While you may have learned how to balance a checkbook, it can be tricky to stay on the right path, given that it’s extra effort on top of everything else that you have to do in your day-to-day life.

The Bottom Line

As you can see, maintaining a healthy and balanced checkbook grants you a lot of boons down the line, much like with any other aspect of personal finance.

How to balance a checkbook?

Step 1: Recording your transactions. The first step to balancing a checkbook is to list each transaction as it occurs. This includes each check you write and any deposits you make, as well as all debit card swipes, ATM withdrawals and assessed bank fees. Always keep a running balance by subtracting the withdrawals and adding the credits.

What to do if your balances don't match?

In the event that your balances don’t match, go back through each transaction and use a calculator to spot any arithmetic errors, as it’s easy to make a mistake when you’re in a rush and trying to do the calculations in your head. If you still can’t locate the discrepancy, ask a bank representative to review the statement with you.

How to reconcile bank statement to checkbook?

When you receive your monthly bank statement, you’ll want to set aside a few minutes to reconcile the statement to your checkbook register. Start at the top of the bank statement and work your way to the bottom one transaction at a time. As you spot that transaction in your register, place a checkmark in the provided column.

How long do you have to keep bank statements?

The IRS recommends saving important documents, like your bank statement, for up to seven years. Since banks are only required to keep records of your account for up to five years after you close it per federal regulation, you don’t want to simply rely on electronic records.

4 Reasons You Should Balance Your Checkbook Monthly

Deborah Fowles was a financial planning and budgeting expert for The Balance who spent over a decade contributing her expertise. She worked in a variety of fields prior to diving into writing, including pathology and marketing.

Benefits of Balancing Your Checkbook Regularly

You might consider balancing your checkbook to be an old-fashioned chore. After all, thanks to online and mobile banking and budgeting apps that track your spending for you, who needs to write down by hand what they spend or deposit into checking each month?

How to Balance Your Checkbook

Unfortunately, the basic money management task of balancing our checkbooks is not taught in most schools and usually not taught by our parents.

Tips

Balancing your checkbook is an excellent opportunity to total up the amount of money you spend each month and look for ways that you could save money next month.

Warnings

The safest form of transaction for your check register is paper checks. Until banks devise a "Check card register", paper checks are the easiest and safest way to bank.

About This Article

This article was co-authored by Michael R. Lewis. Michael R. Lewis is a retired corporate executive, entrepreneur, and investment advisor in Texas. He has over 40 years of experience in business and finance, including as a Vice President for Blue Cross Blue Shield of Texas.

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Preparing Your Checkbook Register

It goes without saying that to balance your checkbook, you need to have a checkbook register with a running balance. If you aren’t doing this, and you want to be able to balance your checkbook at the end of the month, then you need to start keeping track.

Balancing a Checkbook

Okay, now that we have a completed checkbook to work with, break out your latest checking account statement and let’s reconcile the two. Remember, this is all you are doing: accounting for the differences between your checkbook (i.e. your own record) and the bank statement (i.e. their record).

How to Start?

Why Is Balancing Your Checkbook Important?

• Overdrafting and bounced checks
  When looking at the importance of keeping your checkbook balance, the main reason is to not overdraft. To overdraft means to try pulling more money out of a bank account than it already has, which causes checks to bounce. Some banks do have protection against overdraft, giving you s…
• Identity theft
  Now, a bounced check isn’t the only threat. There’s another hidden threat of potential identity theft. If your checkbook is not balanced or if you’re not comparing statements with your check register, some amounts may slip under your radar. One way these identity thieves start going ab…

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How to Prevent Errors in Checking

The Bottom Line