When you open up a checking account at a bank, they will give you a book of numbered checks. When you fill out one of those checks, say for the amount of $100.00, and give it to a store, they will send that check to their bank. Their bank will contact your bank to determine if you have at least $100.00 in your checking account. If you do, they will take that money out of your account.

Sounds simple, right?

But what if you don’t have at least $100 in your account? In that case, your bank will reject the check. The store is left holding a worthless piece of paper. This makes them very unhappy. Not only do they lose out on the $100.00 they were expecting, but they have to go through the hassle of trying to collect their money. That’s why they charge you anywhere from $20.00 to $40.00 dollars, in addition to the original $100.00. 

But that’s not all. Your bank is also very unhappy. They had to go through the hassle of rejecting your check. So they charge you another $20.00 to $40.00 for the effort (and to punish you for doing such a bad job on your money chore).

Now your $100.00 item costs you $140.00 to $180.00 dollars, not to mention the humiliation of passing a bad check, or “bouncing” a check.

First, let’s take a look at writing a check.

Your checkbook consists of the checks, a carbon copy of the check, and a check register.
To write a check, fill out each of the five sections:
1.The date
2.Who you want to give the check to
3.The amount in words
4.The amount in numbers
5.Your signature

Easy right? But now comes the bothersome part: balancing your checkbook. All this means is that you start off with a certain amount of money in your account every month, and record in the check register any checks your deposit, or any checks you write, so you always know how much money is available, in case you want to write new checks.

To balance your checkbook

When you make a deposit or write a check, you need to do is write down the date and the amount, in numbers, in the check register. Do this for every single check you write, even if it’s for a small amount. Do this for every amount you deposit. 

Using a DEBIT or ATM Card, to make a withdrawal or deposit, is the same as writing a check for the purpose of balancing your checkbook. If you don’t write it down every time you use one of these cards, you will end up bouncing a check. 

The best  time to balance your checkbook is when you get your monthly bank account statement.
First compare the checking account bank statement with your check register. You will probably see withdrawals and deposits on your check register that are not on your bank statement. This could be due to delays in stores depositing your checks, or activity that occurred after the bank statement was printed. In any case, this is one of the reasons you want to balance your checkbook every month.

First, write down the ending account balance on the bank statement.

Next, add up all the deposits that are in your check register, that are not on the bank statement. 

Add those deposits to the ending account balance on the bank statement.

Next, add up all the withdrawals that are in your check register, that are not on the bank statement. 

Subtract those withdrawals from the ending account balance on the bank statement.

Congratulations, you have balanced your checkbook, something only achieved my 7% of all Americans.

Balancing a Checkbook Register Online

The only difference between balancing a checkbook online is that the banking website information is more up to date than the printed statement. Use the same process described above.  The total should agree with the balance in the check register.

  • Check your balance online frequently.
  • Don't write a check for more than you currently have in your checking account.
  • Sign up for a program that will pay your check even if it is higher than the balance. This will cost you (your are borrowing money from the bank or credit union), but it is better than bouncing a check.
  • Remember that when you use your Debit Card, it is the same as writing a check.
All You Need to Know
About Checking Accounts

Quick Tips
Banks love it when you bounce checks. They make a huge amount of money punishing their customers for writing bad checks. If you love your bank and want to contribute to their profitability, write a lot of bad checks. If not, check out tips to avoid bouncing your checks.
For Your Information
By balancing your checkbook you make sure your records match the bank's records.

If there's a problem, you can catch it quickly and avoid the expense and embarrassment of bounced checks.  

Banks do make mistakes, but its more likely you either forgot to record a check or you made a mistake in your math.  

Bounced checks affect your credit rating and make it more expensive for you to borrow money.  

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