In the age of PayPal, mobile payment apps like Apple Pay, and the use of automatic bill pay, the days of using the checking account register seem to have passed. BUT balancing your account really shouldn’t be ignored. You’d be surprised at how many people overdraw their accounts simply because they don’t balance their checking account! If you’ll take 15 minutes to balance your checking account, you’ll stay on top of your budget and avoid bounced checks and overdraft fees.
The premise of balancing or reconciling your checking account is to make sure you and the bank agree on how much money is in your account. It helps to find any discrepancies or fraudulent charges as well. If you still use checks, the easiest way to do this is to write every transaction in your checking account register when the transaction takes place and keep a running balance.
If you don’t use checks anymore, another option is to save all your receipts and create a simple spreadsheet where you can keep track of everything. Excel makes it very easy to keep a running daily balance of your account.
The last step is to open and read your account statement from your bank. Whether you get your statement by mail or online, don’t just toss it or delete it – open it up and get to work!
Getting to Work
The first step is to simply compare transactions on your statement with your register/spreadsheet. Make a checkmark next to every transaction that matches your statement. If you missed any bank fees or service charges, make sure to add those too.
If the numbers don’t match up, you’ve probably forgotten to record a transaction. Look over your statement and try again. If it’s been a while since you balanced your checking account, you’re probably not going to get it balanced this month. Just total things up the best you can and continue keeping your records. Next month, if you’re off by the same amount, you can assume you’re on track. Just make the correction in your register/spreadsheet.
ATMs and Online Balances
Don’t use ATM receipts or your current online balance as a method of checking your balance. The balance printed on your receipt or in your account is just a snapshot of how much is in your account at that moment. It won’t account for any checks, debits, fees or deposits that haven’t posted to your account.
You’re overdrawn – now what!
Get money in your account ASAP.
The important thing to do after overdrawing your account is to get your balance positive again. Here are a few options that may be available to you:
- Transfer money from another account. If you have cash stashed in multiple accounts, the easiest way to solve your problem is to transfer funds from an account in the black.
- Pick up extra work. See if you can pick up an extra shift or hours at work, or perhaps you have a special skill that allows you to do side work to make a few bucks.
- Cash in your change. Do you have a change jar that’s collecting dust in the corner or has been holding your vacation fund? Now might be the time to cash that in.
- Sign up for Overdraft Protection Withdrawal Authorization. This will automatically draw funds from a savings account to cover your shortage. There is a small fee, but much less than an overdraft charge!
- Reconsider overdraft protection for the future. Opting out of overdraft protection will ensure you can’t overdraw your account with your debit card, without it your purchase will simply be declined by a merchant. However, if you opt out, it won’t prevent bounced checks. In that case, overdraft protection can prevent the embarrassment of having to tell someone a check is being returned.
Contact the business or person receiving a returned check or transaction.
If you’ve bounced a check, find out if your bank will re-process the check the following day. If so, deposit money in your account immediately, and the person or business cashing the check will never have to know you didn’t have cash to cover the check the first time.
However, if the check is being returned, call that person or business immediately. Do the same for an electronic transaction that was rejected. It’s better to be proactive than wait for the recipient to find out the bad news from the bank. Not only does the situation get resolved more quickly, but it may head off other negative consequences such as having a service canceled or an interest rate increased.
Sign Up for the Mobile App
Most banks have mobile apps that let you check account balances, see transactions, and set low balance alerts – and Litchfield Bancorp has two great apps to help you manage your finances: Our Mobile Banking App and My Mobile Money Access App.
Our mobile banking app you can securely access your account information 24/7 from anywhere using your mobile device. You will be able to:
- Check account balances
- View account history
- Transfer funds between accounts (person to person and bank to bank accounts)
- Receive secure mail alerts
- Deactivate or activate your Debit MasterCard
The My Mobile Money Access app allows you to control & monitor your Litchfield Bancorp debit card use anywhere, anytime through your mobile phone!
- Set custom alerts, so you can monitor your card at all times! Alerts can notify you of things like:
- Card Activity – Card Status Changes – Low Balance – Spending Limits
- International Transactions – Purchases Made in a Specific Category
Assistant Branch Manager