What is a Checkbook Register?
The checkbook register or checkbook ledger is a small booklet that documents all your transactions for reference purposes. These transaction types include your deposits, checks, ATM transactions, as well as card payments and withdrawals.
When it comes to keeping an intelligent journal of all your financial transactions, the checkbook register excels. Because of its records, you can retrieve information that’ll improve your money management habits.
Indeed, your doubts on the possibility of checks bouncing against your expected balance, or whether you received payment, can be a thing of the past if you keep the register as a journal. It can be your agile playbook for all that concerns finance. That way, it’ll keep you informed, helping you create viable budgets for running your business or home.
For ease, consider getting a checkbook ledger app. Today, there are checkbook ledger apps created to help you track and record all your transactions from credit cards to checks and more on the go.
Why You Should Balance Your Checkbook Regularly
The tech age has simplified many tasks. This advancement makes checkbook balancing seem like an unfashionable endeavor. So it's tempting to rely solely on online banking solutions and mobile banking apps that offer periodic updates on personal finance.
Undeniably, fintech makes financial management less burdensome. However, making checkbook balancing a part of your finance culture has more benefits, and here they are:
When you balance your checkbook, you run critical checks by comparing your register with your bank statements. Balancing is a great way to uncover or discourage financial fraud.
Card and identity thieves are known to bypass bank accounts by running test transactions of small amounts to see if this would raise suspicion. It’s difficult to notice these leaks if you’re not regular on balancing.
Bank Oversights and Errors
Banks aren’t always perfect with processing transactions. Most times, transactions fail due to system errors or other reasons. They may reverse significant mistakes, but you may not know about it if you aren't motivated to balance your checkbook. Perhaps, this is enough motivation to start the practice.
How to Balance Your Checkbook
Like most money management skills, checkbook balancing is a skill you must consciously develop on your own. Here are some steps to guide you:
• Always know your current or available bank balance. Your balance is readily available on your online or app banking platform. Record the exact amount on the space reserved on your checkbook register.
• Transactions considered pending or awaiting should also be logged. Run a thorough verification and ensure to include credits, debits, and uncleared checks.
• Document the respective dates and summaries of each transaction. Remember to include the number of each check slip for easy reference. Another great trick is to use copy checks. A copy check acts as a duplicate bearing record of check details and transactions which you can use for reference purpose.
• Beginning with the first transaction logged, deduct the amount from your current bank balance. If it’s a deposit, initiate an addition instead. Then enter this deposit on the new line on your register. Repeat this pattern until you log all your transactions into the register.
• Next, compare your total debits and credits with what’s obtainable on your bank balance. You can access your banking platform for your current balance. If this balance correlates with your register after considering all your debits and credits, then congratulations, you can deem your checkbook balanced.
In cases where there are some inconsistencies with your checkbook and online bank balance, consider initiating a review from scratch. Get your bank statements and use them to guide your calculations. Although, cultivating a habit of balancing your checkbook weekly could prevent surprises and headaches. Consider the checkbook as your money manager.
Common Mistakes To Avoid When Keeping a Checkbook
There are some common mistakes you can make while attempting to balance your checkbook. These include:
• Forgetting to record each of your transactions and their date/time of initiation.
• Choosing to wait until your monthly bank statement arrives might be a mistake. Yes, it may provide you a summary of your transactions, including those done through your debit card. But this delay prevents you from knowing your spending trend and actual balance, tricking you into writing more checks that may not clear.
• Making calculation error is also another error you’ll want to avoid. We recommend going for a checkbook register with a built-in calculator.
How Checkbook Balancing Helps Your Money Management
By following through with proper money management habits like checkbook balancing, we create a clear flow for our accumulated wealth and our financial intelligence increases. Also, you can discern where and how you can spend your money through a smart register of transactions. With this pattern, you develop a financial habit that is informed by self-accountability. These values are essential if we desire to build a financial reputation that helps us make smart investment decisions and qualifies us for credit.
Now, you’ve read through our smart guide on checkbook balancing. Thus, you have a better chance to block out any leakages when you balance your checkbook transactions daily and weekly. Start now and save valuable time by choosing from our best apps for balancing a checkbook.
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