Now that you’ve got a checking account, you want to make sure you regularly check on it and manage it properly.
Protecting Your Checking Account
It’s important to ensure your account is protected, just like your savings account or your credit card. These are some things to keep in mind to help you do just that.
- Never give your account number or bank routing number to anyone you don’t know. You should only give out account information after a transaction has already been made. Always be cautious when making a transaction with a new business.
- Review Your Monthly Statement. Part of being financially responsible is taking the time to review your finances and make sure everything adds up. Reviewing your statement allows you to make sure all transactions were smooth and that there are no mysterious transactions.
- Notify your bank as soon as possible if there’s a problem. The sooner you alert the bank, the better off you will be.
- Don’t write a check or authorize debit if you don’t have the money in your account. You can’t spend what you don’t have and lead yourself into problems and fees. If you plan on using a check, make sure the money you intend to spend is in your account before you write it or use your debit card.
Depositing into the Account
There are several ways to deposit money into your checking account. You’ll want to know what each one is and decide for yourself which you’d prefer to use.
Endorsed Check:
- Blank Endorsement: On the back of a check, you will find an “X_________________” with the words “Endorse Check Here” above it. A blank endorsement is created by signing your name on the line exactly as it appears on the “Pay to the Order of” line. A check with a blank endorsement can be deposited by anyone, regardless of whether or not the check is written to them. It is recommended to only use a blank endorsement when withdrawing cash and you shouldn’t sign it until you are at your bank.
- Restrictive Endorsement: This is similar to a “Blank Endorsement”, the only difference being that above your signature you would write “For Deposit Only” on the line. This type of check can only be deposited in your own account. Some banks may also ask you to write your account number beneath your name.
- Special Endorsement: A special endorsement comes into play when you wish to give your check to another person. In order to give a check a special endorsement, on the back write “Pay to the Order of” followed by the name of the person you want the check to go to. Underneath that, sign your name.
Depositing Cash or Checks:
When funds are placed into the account, there may be a hold on them for a short period of time while the check is being process. Even if the check is cashed, an equivalent amount is “held” in your account. This hold is lifted after the cash has been removed from the check holder’s account. The only problem that may arise in this situation is if the check bounces, in which case you will not receive the funds and you may be charged a fee.
- Bank Teller: In order to deposit a check or cash to a bank teller, you will need to fill out a deposit slip. Some checkbooks already come with a deposit slip which you can use. When filling out what goes where, make sure to write the numbers in the correct section, there are usually different sections for cash, coin, and checks. If you want some of the cash from the check you are depositing, write out the amount in the section labeled “Less Cash Received”. If you are cashing the full amount of the check you may not need to fill out a deposit slip.
- ATM: Using an ATM is relatively simple, follow any instructions on the machine itself when depositing cash or a check. Most ATM’s will require you insert your ATM Card or Debit card and type in your pin number. Depending on the machine, it may allow you to insert the check directly, others may ask you to fill out a deposit slip and insert the slip with a check in an envelope
- Direct Deposit: This is perhaps the most convenient method of depositing money into your account. In this method, money is electronically transferred directly into your account without any transference of a paper check. It is frequently used by employee paychecks and government benefits. It is highly recommended that you take this option should your employer offer it as it is much more convenient than going to your bank. They are also often processed quicker allowing for quicker access to your money. Most employers will have a form which you can fill out to sign up for direct deposit. This form usually asks for your account information and generally a voided check. A voided check is simply a check you have written “VOID” across of. Of course, should any problems arise notify your employer immediately.
- Mobile Deposit: A popular method for depositing a check is to do it via your smartphone. It is relatively simple and you can check out the video below describing how it’s done.
When funds are placed into the account, there may be a hold on them for a short period of time while the check is being process. Even if the check is cashed, an equivalent amount is “held” in your account. This hold is lifted after the cash has been removed from the check holder’s account. The only problem that may arise in this situation is if the check bounces, in which case you will not receive the funds and you may be charged a fee.
Balancing Your Checkbook
Balancing your checkbook isn’t all that hard and it can be done in these simple steps. You’ll need some things to get started though: Checkbook Registry (found in your checkbook), Lined paper, pen or pencil, and basic math skills/a calculator.
- Be sure to keep track of all the checks you write, and money you take out of your checking account at ATMs and purchases made with a debit card. Enter all of these numbers into your checkbook registry. In order to do this properly, you’ll need to save your receipts from ATM’s and when you use a Debit Card.
- Get your latest bank statement, your registry, and lined paper together.
- Check your statement for the checks which have cleared, when you have found them, check that off in your registry.
- Make sure any deposits on the statement are recorded in your register, if they aren’t, record them in.
- Compare withdrawals you’ve made whether it’s with a bank teller, ATM, or debit card with the amounts in your statement. Write down any you’re missing.
- Make a note of additional amounts present in your statement and record them in your registry. Update these numbers into your standing balance.
- Now use the lined paper, and divide it into two columns. In one column, label your Outstanding Deposits and total them. In the second column add up any outstanding checks, cash withdrawals, or debit purchases not present on your statement.
- Write down the ending balance on your statement, add the Outstanding Deposit Total, and subtract outstanding checks, withdrawals and debit from that total. This final number should be the total amount currently available in your checking account.