Your Checking Account
Author: Terry Rigg
Checking accounts are an absolute necessity these days. You can
either have a checking account or run to the bank or other
outlet for money orders. Many people pay for almost everything
with a check including groceries, gas, clothes and a long list
of other things. When you add an ATM card to this picture, your
chances for a potential problem is greatly enhanced.
Don't get me wrong. There are many people that can keep their
check book up to date, even deducting all of the ATM advances
and automatic withdrawals as they make them. However, too many
people that write checks for everything wind up not entering a
check when it is written or an ATM advance when it is made. The
result is a bounced check fee of up to $25 for the bank and god
only knows what the store where you wrote the check could
charge you.
It seems like carrying cash to pay for things isn't the "IN"
thing to do. When I'm in the check out line, most people are
paying with a credit card, debit card, or check. I realize that
carrying cash has it's risks. You could lose it or have it
stolen. What are the risks when paying by check? There are
absolutely none if you enter each check and properly deduct the
amount from your account. However, I have counseled people that
have as much as $100 per month in overdraft fees. This isn't
just for one month. This is an average over a six month period.
That is a lot of money that these people couldn't afford.
What's the best way to handle my checking account?
If you don't have problems keeping up with your checking
account, keep doing what you are doing.
If you occasionally have bounced checks, I recommend that you
use your checking account only to pay your monthly bills and
use cash for everything else. If you have an ATM card, destroy
it.
With that said, I know you will probably not quit writing
checks or destroy your ATM card. So let's look at what you need
to do to keep up with your checking account.
Determine exactly how much money you have in your account even
if you have to go to the bank for help.
Enter that information on a new page in your check register.
Enter the date, your check number, payee and amount in your
check register when you write he check. Don't worry about the
people in line behind you. This will only take a few seconds.
If you like, you can deduct the amount of the check when you
get home.
Take your check book with you when you use the ATM and enter
your withdrawal while you are still at the machine.
Develop a system to deduct automatic withdrawals. It is
probably best to deduct these on the first of each month.
Add any deposits as you make them. You need to find out how
much and when direct deposits should be entered in your check
register.
When you receive your bank statement, reconcile it as soon as
possible. If you find any discrepancies check them out
immediately. Don't give up until you are sure you have resolved
the problem. The balance you show in your check register should
match the bank, less any bank charges.
When you reconcile your bank statement be sure to clearly mark
the checks that have been returned to you. One of the biggest
problems people have with overdrafts is missing a check that is
taking a long time clearing the bank. Go back at least a month
to make sure all previous check have cleared.
I really don't mean to insult anyone's intelligence with this
article. Having problems with your checking account, as with
all other money problems, isn't a matter of intelligence
anyway, it's a matter of discipline. It can cost you a lot of
money by not applying that discipline to managing your checking
account.
About The Author: Terry Rigg is the author of Living Within
Your Means - The Easy Way
http://www.homemoneyhelp.com/ebookadpage3.html and editor of
the Budget Stretcher web site. To Subscribe to The FREE Budget
Stretcher Newsletter and receive The Complete Budget and Bill
Organizer absolutely free just visit his home page at
http://www.homemoneyhelp.com
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