Balancing a Checkbook
Balancing a checkbook isn’t really all that difficult a task, especially if you keep track of your purchases on a regular basis. The task gets much more difficult, however, when you make a lot of debit card purchases and write a lot of checks but you don’t really bother to update your checkbook very often. Balancing a checkbook is definitely one task that gets more difficult the more you ignore it.
Why should you bother to balance your checkbook? After all, if you have a roundabout idea of how much money you have in your bank account, why should you worry about it down to the penny? There are a few reasons:
1. You have an accurate record in case there is an error. If you check your account balance and it seems to you as though there should be more money in there than the bank says you have, it’s a lot easier to find the discrepancy if you have been keeping tabs on your checkbook really well. Otherwise you’ll have quite a bit of research to do in order to find out if the balance is accurate or in error.
2. You’ll realize more quickly if someone has tapped into your account. If your debit card number or checking account number gets stolen by someone there may be a few small purchases to begin with as the thief “tests the waters” to see if there is money in the account. If you balance your checkbook regularly then you’ll immediately notice the unauthorized charges, but if you only have a vague idea of your balance then you may not catch on to these transactions until the thief makes a really large withdrawal.
3. There is something really nice about knowing exactly how much money you have. You can’t be fully in charge of your personal finances if you don’t really know how much money is in your checking account. Keeping tabs on your money is one of the single most important things you can do in order to effectively manage your money.
In other words, maintaining a checking account shouldn’t be a spectator sport.
You can either balance your checkbook the old fashioned way, with a pencil, calculator, and a bank statement. You can also use software designed to keep track of all your spending. The great thing about these programs is that oftentimes they have the capability to where you can log on to your bank’s online system and download all the transactions directly from the website. You only have to input checks you write.
What do you do if you haven’t balanced your checkbook in a really long time? There are a few different options, but unless you want to sift through years of statements you might want to just start balancing your account now, making adjustments until you have everything squared away.
Wouldn’t it be great to actually know how much money is in your account?
