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Yes, you can balance your checkbook every month down to the last penny with a minimal amount of time and effort. It is very important to do so in today’s world to avoid becoming a victim of fraud and identity theft.

There are a few points to keep in mind when balancing your checkbook. First, the ending balance in your checkbook and the ending balance on the bank statement will not match due to synchronization. You are currently balancing your checkbook, the bank statement has a closing date that is usually printed at the top of the statement. Second, the only differences that occur between your bank statement and your checkbook are deposits in transit, unrecorded deposits, outstanding checks, transfers, and adjustments. And finally, remember that the bank is always right.

When you receive your bank statement, take your checkbook register and place them side by side. Start with the ending balance on the bank statement. The bank statement will list all deposits made to your account during the time period you are reconciling. Compare the deposits on the bank statement with what you have recorded in your checkbook register. A deposit in transit is an amount you have in your checkbook but doesn’t appear on your bank statement because of the statement date. Add these amounts, if applicable, to the ending balance on the bank statement. A non-recording deposit is an amount that the bank shows but is not in your checkbook register. Add these amounts, if applicable, to your checkbook register. This section is usually the easiest to balance as magical amounts of money do not appear in your account. These amounts result from actual money you take to the bank, deposit transfers between accounts, or direct deposits from payroll.

Next, you’ll want to see what checks the bank you wrote on your account cleared. These are listed on your bank statement in numerical order. Follow this order and place a check mark next to the check in your checkbook register that cleared at the bank. Those checks in your register that do not have check marks next to them, also known as outstanding checks, should be subtracted from the bank statement balance. Be alert because the check may clear for a different amount than what it was written on. Either the writing on the check was unclear, or the numbers were transposed.

Other withdrawals that may occur during the statement period include debit card purchases, automatic debit payments, and ATM withdrawals. Make sure all reductions on your bank statement are entered in your check register. It’s important to check this section on your bank statement and make sure it matches your checkbook, as this is the area where fraud is rampant. If you know where you purchased and used your debit card or when and where you stopped and made an ATM withdrawal, then those transactions are the only ones that should appear on your bank statement. If there are other withdrawals on your statement that you can’t account for, contact your bank right away!

There may be adjustments to your account, such as interest, service fees, and occasional bank adjustments. Yes, I realize I said that the bank is always right. Well it is. Each and every bank employee who comes into contact with money must balance at the end of the day. Trust me, they will find their mistake. And they often find their mistakes too! Remember to subtract your fees and add the interest to your checkbook register.

The ending balance on your statement should now match the ending balance in your checkbook register. If the amounts are not the same, I usually find it in withdrawals. Specifically review the cashed checks and the amounts for which they were cashed.

You work hard for your money! By following these easy instructions, you can have less frustration and a better understanding of where that money is going and can protect yourself from the many instances of fraud in today’s society.

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