Do you cross your fingers when you write a check, hoping it won't bounce? Then it's time to learn how to monitor your finances.
Step 1: Keep track Keep track of all the checks your write, the money you withdraw from your checking account at ATMs, and the purchases you make with a debit card. Enter everything into the registry that came with your checkbook.
Step 2: Get organized Find or download your latest bank statement, grab your checkbook registry, a piece of lined paper, and a pen or pencil.
Step 3: Mark cleared checks Look at your statement to see which checks have cleared, and tick them off in your register.
Step 4: Verify deposits Verify that any deposits listed on the statement are recorded in your register. If they're not, enter them.
Step 5: Reconcile withdrawals Compare any withdrawals you made, whether through a bank teller, an ATM machine, or a debit card, with the amounts debited on your bank statement. If you missed any, write them in your checkbook registry now.
TIP: Keep your ATM receipts until you can verify them on your bank statement.
Step 6: See what's left Note any additional amounts listed on your statement, like interest added to your account or bank fees that were deducted. Record these in your register. Then update your ending balance.
Step 7: Create a balancing ledger Take the piece of lined paper and divide it into two columns. In the first column, write down all your outstanding deposits and total them. In the second column, add up your outstanding checks and any cash withdrawals or debit purchases that are not on your bank statement.
Step 8: Do some math Take the ending balance on your bank statement, add the outstanding deposit total, and then subtract the outstanding checks, withdrawals, and debit charges. This is the total amount currently available to you in your checking account. And your checkbook is now balanced!
FACT: According to a survey, 40 percent of Americans don't balance their checkbook and 20 percent don't keep track of their finances at all.