How to Balance a Checkbook

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Balancing your checkbook is one basic financial step that is often pushed to the side and forgotten about. I have to admit that I am not the best at keeping up with my checkbook but it something that I am aware of that needs to be improved. There are several reasons why keeping up with your checkbook is vital. Some of those reasons are as follows:

1.) The bank can make mistakes and this is a great way to check to make sure everything is accurate
2.) It keeps all your finances in order
3.) It keeps you from making overdrafts and being charged extra money because of it

I would recommend that you balance your checkbook every time you receive a bank statement, which means every month you should be comparing your statements against your own personal records. It may seems like too often but it is so easy to make a mistake and lose track of a few dollars or cents here or there which can add up to a headache later when you are trying to figure out three months of bank statements that don’t match up to what you have. Plus, once you get the hang of it, it should only take you about 10 minutes which really isn’t much time at all. If you balance your checkbook and you discover that things are really out of sorts I encourage you to go to a financial advisor. Chances are if your checkbook and bank statements aren’t matching and you have a large amount of money unaccounted for, there may be other problems that should be address as well. There are a numerous number of free financial counselors that would be more than happy to help you out. The sooner you get a handle on your money the better.

The following list was taken from www.mappingyourfuture.biz
To balance your checkbook, follow the simple steps listed below:

1. Ensure you’ve entered all automatic transactions (e.g., ATM withdrawals, electronic transfer of funds, online bill payments, debt card transactions) into your check register.
2. Review your statement.
3. Compare your statement with your check register and mark off all items that match.
4. Add to your register any deposits or additions from your statement, including interest payments and ATM or electronic deposits.
5. Subtract from your register any account deductions, including fees and ATM or electronic deductions, that are not already entered.
6. Update your statement information.

If you have followed the directions and your statement and check register don’t match, go back and check your numbers to make sure you just didn’t write in the wrong number by accident. If you still are having problems, take a break and go back to it later. Maybe you’re just not seeing it correctly because you’ve been doing it too long.

Like learning anything new, it will take time to get the hang of it but keep at it. It’ll become second nature soon enough and you’ll feel much better knowing that you know exactly where all your money is. Good luck!