Balancing Your Check Book

Each month you will receive a bank statement by mail unless you have agreed to receive it online.  Carefully look over your statement.  Place a checkmark in your transaction book next to all the items that are also on your statement.  Take note if there are any differences.  Add any interest the bank has paid you; subtract any fees the bank may have charged (make sure they are legitimate).  Subtract any checks that might not have cleared.  If you find any discrepancies between your numbers and the bank’s you have a little detective work to do.  You need to find out why.  This is not fun, but necessary.

Start by checking your math; make sure all your additions and subtractions are correct.  Subtract the balance in your transaction register from the balance statement.  Does the amount match the amount of one of your transactions?  If you still find an error, or see an inappropriate fee, contact your bank.

It is a good idea to create a cushion at the bank.  Keep a little extra in your account, a certain minimum balance, in case of an emergency or you forget to record a transaction.  You never want to bounce a check or have your bank call you saying you have insufficient funds.  This can cost you dearly, with additional fees/penalty or loss of interest, if that applies . Periodically review the type of bank account(s) you have.  Have your circumstances changed?  Is this still the correct type of account for you?  Here is a good site if you have any further questions.