When a bank customer receives a statement in the mail, the statement provides a list of transactions that took place in the previous month. The transactions are both incoming and outgoing, adding up to a final tally which is shown as the current account balance for the convenience of the bank customer. Without the statement, the customer would have more uncertainty about the contents of the account. With the statement the bank customer knows how much was spent, how much was made, and what the current state is.
In fact, as soon as the bank customer starts using money linked to the account, he or she sets the finances into motion again. The most recent statement is no longer up to date. One way to rectify this problem is to use a checkbook register. Although it sounds fancy, it is merely a manual bookkeeping device that keeps track of the transactions much as the statement does. Except the checkbook register stays with the customer at all times.
There are compelling reasons why one should track the level of money in the bank account. Any time an attempt to use the money when there are insufficient funds, a penalty or fee can be triggered. The penalty comes not only from the bank, but can also come from the target of the payment. This increases the complexity of the transaction as well as irritates one’s relationships with vendors who expect timely payments.
What sort of transactions specifically incur such penalties? Writing a check for the rent, for example, that draws upon insufficient funds can trigger the penalty. In this case, one’s relationship with the landlord is also put at risk. This is on top of triggering a bounced check fee in addition to a returned check fee that are frequently issued. Even using an ATM as a charge card at the supermarket for a $25 bag of groceries can trigger an overcharge fee when the bank covers the cost but forces the customer to pay heavily.
Checkbook registers reduce the chances of such errors occurring. For people who have trouble managing their finances but also find maintaining a checkbook register too burdensome, there are electronic alternatives which are faster and easier to use. These are merely calculator-like devices that can easily be carried around. They have special entry keys for the different kinds of transactions one might encounter related to the checking account.
Very recently the U.S. Senate implemented a series of consumer-friendly finance rules relating to how banks charge overdraft fees (this fee is incurred whenever a bank steps in and pads a customer’s account whether or not the customer wants it). Basically a bank must ask a customer to opt-in to their overdraft fee program. However, the flip side is that without the overdraft fee, checks will bounce and cause other kinds of trouble. Therefore, it is still best to keep finances in check with devices like the checkbook register.
Free Printable Check Register Template – Download