Checking Account Balancing

Dear Dr. Per Cap:

Do I need to balance my checking account every month? Seems like a lot of time spent on a boring task that the bank does for me. Also, why do they call them checking accounts when no one writes checks anymore?


Why Balance?

Dear Why Balance,

Let’s start with the name. I suppose most banks still use the term “checking account” because old habits die hard.

Kind of like how cars still have “glove boxes” when no one wears gloves to drive anymore. People use the phrase “fast forward” even though no one’s touched a VCR since Harry Potter played his first game of Quidditch. “Motor” oil should technically be called engine oil, unless you’re driving a Tesla.

You get the point.

Also, please remember that while electronic banking transactions might be the norm for you, it’s estimated that about 50% of checking-account holders still write paper checks, especially for larger transactions, like paying rent.

I think it’s a good practice to balance one’s own checking account. And while it’s true that most of us receive a monthly account statement from the bank, mistakes can and do happen. I’ve been overcharged by hotels claiming I took chips and sodas from a mini-bar I never touched. I’ve also seen unscrupulous servers turn a generous $10 tip I wrote on a receipt into a $20 tip with a smudge and swipe of a pen.

And don’t get me started on how easy it is to accidentally authorize a “free” app or online service to debit your checking account for a monthly subscription.

By hook or crook (an antiquated phrase if ever there was one), it might be days or weeks before charges like these are debited from your account. But the organized person who balances their checking account on a regular basis will quickly catch shady and other unauthorized transactions, and be able to dispute them. Over time, you’d be surprised by how much money this oversight can save you.

Balancing your checking account is also a really good way to stay on top of your finances. Think of it like a monthly check-in where you review how much income is coming in and how many expenses are going out. This accounting can help you stick to a budget, set financial goals, and be a savvy consumer.

There are also loads of great apps and software programs to help you balance your checking account if you don’t want to do it by hand. And don’t forget to frequently reconcile your other financial accounts that you use to make purchases, like credit cards. Once you get a good system nailed down, you’ll find it hardly takes any time at all to balance those accounts, too.


Ask Dr. Per Cap is a program funded by First Nations Development Institute with assistance from the FINRA Investor Education Foundation. For more information, visit To send a question to Dr. Per Cap, email