Every Household Should Have a Budget continues with tips on how to handle your checking account. Here is my first question, do you balance your checking account? I am disappointed to say that when I ask my clients this question more often than not I get the answer, "no".
Here is the problem with not balancing your checkbook. You will never catch any errors and the possibility of being overdrawn greatly increases. I have seen another trend when it comes to spending with NSF (Non-Sufficient Funds) fees charged by the bank. Some banks are charging as much as $35 for each occurrence. It doesn't matter if your account is short by $.05, it is going to cost you $35.
Last year I had a client tell me he couldn't save money. With that statement I knew we were in for some hard conversations. He sent me his documents, and sure enough he had incurred $3500 in NSF charges!! There was his savings/down payment!!
To balance your checkbook, you need to take your monthly statement and compare it to the checks you have written and the charges you have made if using a debit card. I suggest logging all debit card expenses in a journal. It will make it easier to complete this task.
Staying on top of your checking account will give you control over your money.