When someone is first enter the world of finances, they will need to learn some new basic finance skills. Unfortunately, many teenagers and young adults get to college without having a clue about some basic personal finance tasks. You might make a lot of bad money choices, but if you have some basic financial knowledge, you can minimize your mistakes. After this article, first timers should know how to write a check, keep a checkbook register, and balance a checkbook.
To write a check, you have to fill out a few fields as follow:
When you start writing checks on your checking account, it is important that you keep an updated checkbook register. If you don’t, you might overdraw your account and be forced to pay fees to your bank. Some banks will charge outrageous fees for this type of error, so add your numbers carefully.
Anytime you write a check or make any type of withdrawal from the account or make a deposit, you must write that down in your checkbook register. Maintaining your checkbook register will require some discipline, but you cannot organize your finances if you do not keep good records.
Image from Somerset Trust: Your Checkbook Register
Your goal is to maintain a positive balance above required minimum balance so that you don’t bounce your check and avoid account maintenance fee.
Every month you will get a statement from your bank. When you receive the statement, get your checkbook and check off (either in transaction type box or balance box) each item that is on your statement and in your checkbook.
If there are items on your statement that are not in your checkbook, add them to your checkbook register on your next open line. If there are items on your checkbook register but not on the statement, this means the bank did not clear the charge yet. Follow your checkbook register as that represents the correct balance once the charge does clear.
To confirm your balance, you will need to (on a separate paper) withdraw any charges from the checkbook register balance that have not yet cleared. If the two balances match, your checkbook is balanced. However, if there are different numbers, you will need to do some more digging because you probably forgot to include a charge or considered something cleared that had not yet cleared.
Learning how to work with a checkbook is an essential financial skill, so be sure to follow these guides and learn how to properly manage your checking account.