Last updated on March 31st, 2020 at 02:23 pm
Although checks are getting used lesser nowadays, they are still one of the most popular ways to pay. Some people write checks for insurance benefits, payments for Social Security and other benefits, and paychecks.
What Are Checks?
The basic definition for a check is that these are paper forms that people use in transferring a certain amount of money. It is a written order that banks read as an instruction when people pay cash from a particular checking account to a specific entity or person.
Where To Get Checks
If you’re starting with using checks, you can get a supply of checks from your financial institution when you open a checking account. If you need more, you can order for a fee.
Why Use Checks
When paying for stuff, you can use checks. People prefer these as they are a convenient and safe way to pay. If you carry checks with you, you won’t need to bring a lot of money with you. You get a record of the amount of money you spent and where you used them every time you write a check.
If you’re the type to track the amount you are buying and spending, this is one of the best ways to do so. It helps you avoid paying more than what you have planned. Aside from that, you can also record checks that are still outstanding online or at a physical transaction register. It also includes checks that are cleared the bank.
What is A Checking Account
You may have noticed that there are mentions of a checking account above. If you are wondering what it is, here’s a bit of the basic.
When it comes to managing your money every day, one of the best tools to use is a checking account. But what exactly is it?
A checking account a bank account type that allows you to withdraw money or deposit. You can also use it to pay for things instead of using cash.
It’s pretty convenient for managing your everyday spending especially when it comes to buying groceries. Just like using a debit card, writing checks are one of the safest and most convenient ways to pay from your checking account. Plus, whenever you need money, it’s there for you.
Every time you make a purchase or write a check with a debit card, you get a record of where you spent your money and how much you spent. It helps you pay closer attention to how much you are spending, what you are buying and avoid going over the budget.
A checking account also helps make it easier for you to deposit checks that people give you. One tip we can give you is that a checking account enables you to avoid the high costs from check cashing stores.
Lastly, always remember that it is different for every financial institution when it comes to offers on checking accounts. They provide different fees, benefits and features so be sure to shop around for that checking account that can meet what your needs are.
So Why Should you Get a Checking Account?
- Avoid high cost from check cashing stores
- Track spending better
- Convenient purchasing and paying bills
- Withdraw and deposit cash quick and easy
- Keep your money safe
- Low-cost checking
- Can use the online bill pay system of the bank
- Access your account anywhere
Parts of A Check
Now that you know what a check and a checking account are. It’s time to talk about the components of a check. It will serve as a guide to fill out a check.
Name and Address
For convenience, you can see that your address and name is already pre-printed on the check. It also tells the payee that you are the one who wrote it.
This is where you are going to write the date today. Just a tip for you, it is best if you use only one format when writing the date. It helps you know if one of the checks are forged since it has a different date format.
Pay to the order of
Otherwise known as the payee, the pay to the order of blank space is where you write the company or person who will be receiving the money. If you are going to withdraw for yourself, write “cash” on the blank.
Numeric Amount Box
Write the specific amount of money you are sending on this box. Make sure to write legibly and ensure that the period between the centavos and the whole numbers are precise. You wouldn’t want any mistakes here.
After the numeric amount box, write the amount in words. Start at the line’s left edge and by the time you are finished, draw a simple line on the remaining space until you hit the word “dollars.” In case the numbers written on the numeric amount box is unreadable or different from what’s written, the written amount will become the right amount of money that the bank will honor.
It is where the bank that holds your account is placed.
Writing on this part is optional. You can use it to remember what you are using the check for by briefly writing a description.
The check will only become official once you sign it. It allows the bank to release the amount of money to the payee.
The check number helps you keep track of your payments. Whenever you write a check, don’t forget to record the check date, number, payee’s name and the total amount in the check register. Make sure also that you calculate your check balance.
Your 10-digit account number is unique. It will tell the bank which accounts the money is going to come from.
Lastly, the bank routing number identifies which bank has issued the check. When setting up direct deposit, you will need this number. A direct deposit allows the Department of Defense or your employer to directly and electronically deposit your paycheck to your bank account without the need to give you a paper check.