Checking Your Balance: A Timeless Practice

When was the last time you paid for something with a physical check? The answer to this might depend on your generation and the types of purchases you’ve made recently.

Cash and checks used to be the most common payment methods, and due to checks taking time to clear, it was standard practice to keep track of money coming in and out of your account with a physical checkbook register. You may remember the days that you (or maybe you watched a relative) sit down with their checkbook register and bank statement to reconcile their accounts.

While modern-day banking may have changed the way you track your finances, the main purpose of balancing a checkbook – to keep tabs on money you’re receiving and spending and know what’s in your account– remains just as important.

Why keep a pulse on your money

Tracking your income can help you monitor the sources of your money and grasp how often (and how much) money is flowing into your account. You might think that your paycheck is your only source of money, then realize that you’re also receiving money from friends and family, side gigs, tax returns, lottery winnings, etc. On the flip side, tracking your spending allows you to know where your hard-earned money is going and determine if you’d like to make any changes to your spending habits.

Prioritize Your Spending in 5 Easy Steps

Another major benefit of keeping a close eye on your transactions and account balances is to protect yourself against fraud. If you always know exactly, or even approximately, how much money you should have in your accounts, it’s easier to spot when the balances look off or things aren’t adding up. This is also true for identifying transactions that you don’t recognize or can’t account for.

The pen and paper method

While it’s less common these days to balance your accounts by hand, many people still use or prefer this method. The overall goal is to make sure that your records match the bank’s records. With the pen and paper process, you’ll use a small booklet to record transaction dates, descriptions, withdrawal/deposit amounts and balances. Then, you’ll check this against bank statements (traditionally paper, now mostly online) to make sure everything adds up.

However, it’s important to note that there’s more room for error with the pen and paper method than with the digital route, since forgetting to record even one or two transactions can lead to your records not matching your bank statements and can set you up for confusion.

One of the biggest perks of balancing your checkbook is awareness of payments or incoming funds that aren’t yet reflected in bank statements. For example, you might record in your register that you paid your mortgage by check, but not see that transaction in your statement until the check clears. Keeping meticulous records can prevent you from spending money that you don’t have.

How to Practice Financial Self-Care

“Digital checkbooks” and online banking

The advent of online banking made tracking money a much simpler and more automated task. Online banking allows you to view your statements and transactions in real-     time and see your up-to-date balances.

However, there are some caveats to this. How long a payment or withdrawal takes to reflect on your online banking account or clear the system depends on factors like the payment type and amount. You may have paid a friend for dinner via a payment app, but not see a withdrawal for that amount in your transaction history until a few days later.

Online banking has made managing our finances much more convenient, but it’s not magical – you still need to have a firm grasp of your income and spending to monitor what’s been accounted for and what hasn’t been posted or cleared.

We’ve created a free digital checkbook register to help you reconcile your accounts and keep close track of your finances.

Download our free digital checkbook register! 

There’s no right or wrong way to keep track of your money, as long as it works for you! Find a system that empowers you to own your personal banking and financial future. Rockland Trust’s team is also here to answer your questions about online banking, money management and other financial topics. Check out our Learning Center resources or stop by your local branch today!